Question

Document - Word gs View Help Search Review E E A ABCD AaBbCcDd AaBbcc AaBbcc AaB AaBCD ABCD ABbc 1 Normal 1 No Spac... Heading 1 Heading 2 Title Subtitle Subtle Em Emphasis Paragraph Styles The following lots of a particular.commodity were available for sale during the year Beginning inventory 8 units at $52.00 First purchase 19 units at $50.00 Second purchase 23 units at $21.00 Third purchase 19 units at $65.00 The firm uses the periodic system, and there are 25 units of the commodity on hand at the end of the year. What is the amount of inventory at the end of the year according to the average cost method Do not round intermediate calculations. Round your final answer to the nearest whole dollar. Select the correct answer. $1,300 $1,361 $1,266 $1,117 (Ctrl) -

Answer 1

Answer

• Correct Answer = Option #4: $ 1,117
• Working

Average Method	Cost of Goods available for sale
	Units	Cost/unit	COG for sale
Beginning Inventory	8	$                52.00	$                            416.00
Purchases:
#1 purchase	19	$                50.00	$                            950.00
#2 purchase	23	$                21.00	$                            483.00
#3 purchase	19	$                65.00	$                        1,235.00
TOTAL	69	$              44.696	$                        3,084.00

• Ending Inventory = 25 units x ($3084 / 69 units)
  = $ 1117