Perpetual Inventory Using Weighted Average Beginning inventory, purchases, and s

Question

Perpetual Inventory Using Weighted Average

Beginning inventory, purchases, and sales for Meta-B1 are as follows:

a. Assuming a perpetual inventory system and using the weighted average method, determine the weighted average unit cost after the July 23 purchase.
$per unit

b. Assuming a perpetual inventory system and using the weighted average method, determine the cost of the merchandise sold on July 26.
$

c. Assuming a perpetual inventory system and using the weighted average method, determine the inventory on July 31.
$

July 1 Inventory 100 units at $400 12 Sale 70 units 23 Purchase 120 units at $450 26 Sale 110 units

Explanation / Answer

a) Weighted cost of inventory = (30*400+120*450 )/ 150 = 440

b) Cost of merchandise sold on July 26 = Weighted cost of inventory = 440

c) Inventory on July 31 = (100-70)+120-110 = 40 units at cost of 440

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