A company uses the periodic inventory system and had the following activity duri

Question

A company uses the periodic inventory system and had the following activity during the current monthly period.

November 1:     Beginning inventory of     102 Units @ $30
November 5:     Purchased                      102 Units @ $30
November 8:     Purchased                      52 Units @ $30
November 16:   Sold                               134 Units @ $55
November 19:   Purchased                      25 Units @ $30

Using the weighted-average inventory method, the company's ending inventory would be:

Explanation / Answer

Answer:

Since there is a purchase of inventory at the same rate everytime therefore there wont be any change in the weights

Hence the closing inventory is 4410

Thank You.

Opening inventory value Addition Sold Closing Qty Closing Price weighted average Closing inventory 1st November 3060 0 0 102 30 3060 5th November 3060 3060 0 204 30 6120 8th November 6120 1560 0 256 30 7680 16th November 7680 0 7370 122 30 3660 19th November 3660 750 0 147 30 4410

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