Compute the April 30 inventory and the April cost of goods sold using the average-cost method. (Round answers to 0 decimal places, e. g. 2,760.) Ending inventory $enter the ending inventory in dollars rounded to 0 decimal places Cost of goods sold $enter the cost of goods sold in dollars rounded to 0 decimal places

Question

Business

Micah Vance

26 April, 09:40

Compute the April 30 inventory and the April cost of goods sold using the average-cost method. (Round answers to 0 decimal places, e. g. 2,760.) Ending inventory $enter the ending inventory in dollars rounded to 0 decimal places Cost of goods sold $enter the cost of goods sold in dollars rounded to 0 decimal places

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Answers (1)

Know the Answer?

Billy Rose · Answer 1

The weighted average cost per unit is = $19.76, cost of goods sold is $8,892, the ending inventory is = $10,868

Explanation:

Solution

Given that:

Cost of goods available for sale

Units Unit Cost Total Cost

April 1 inventory 280 $17 $ 4,760

April 15 purchase 420 20 8,400

April 23 purchase 300 22 6,600

1,000 $19,760

Now,

The weighted average cost per unit = Total cost/Total available units

= 19,760/1,000

= $19.76

Thus,

The Cost of goods sold = Number of units sold x Weighted average cost per unit

= 450 x 19.76

= $8,892

The Ending inventory = Number of units in the ending inventory x Weighted average cost per unit

= 550 x 19.76

= $10,868

Complete question: Cheyenne Company uses a periodic inventory system. For April, when the company sold 450 units, the following information is available:

Units Unit Cost Total Cost

April 1 inventory 280 $17 $ 4,760

April 15 purchase 420 20 8,400

April 23 purchase 300 22 6,600

1,000 $19,760

(1) Calculate weighted average cost per unit

(2) Compute the April 30 inventory and the April cost of goods sold using the average-cost method