Use the following to answer question 13: The following information was available

Question

Use the following to answer question 13: The following information was available from the inventory recorda of Rich Company for January: Units Unit Cost Total 9,000 S9.77 $87,930 6,000 10.30 61,800 Cost Balance at January1 Purchases: January 6 January 26 8,100 10.71 86,751 Sales: January 7 (7,500) January 31 1100) Balance at January 31 4,500 13. Assuming that Rich does not maintain perpetual inventory records, what should be the inventory at January 31, using the weighted-average inventory method, rounded to the nearest dollar? A) $47,270. B) $46,067 C) $46,170. D) $46,620. Page 5

Explanation / Answer

Weighted average cost per unit = Total costs ÷ Total units = 236,481÷23,100 = $10.2373

Ending inventory at January 31 = Units unsold × Weighted average cost per unit = 4,500×10.2373 = $46,067

Answer is option (B) $46,067

Units Total cost Balance at January 1 9,000 $87,930 Purchases: January 6 6,000 61,800 January 26 8,100 86,751 Total 23,100 units $236,481

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