Question

SB Beech Soda, Inc. uses a perpetual inventory... Beech Soda, Inc. uses a perpetual inventory system. The company's beginning inventory of a particular product and its purchases during the month of January were as follows: Quantity Unit Cost Total Cost Beginning inventory

(Jan. 1) 23 $ 14 $ 322 Purchase

(Jan. 11) 15 $ 20 300 Purchase

(Jan. 20) 26 $ 22 572

Total 64 $ 1,194

On January 14, Beech Soda, Inc. sold 28 units of this product. The other 36 units remained in inventory at January 31. Assuming that Beech Soda uses the average cost flow assumption, the cost of goods sold to be recorded at January 14 is: (Round your intermediate calculation to one decimal place and final answer to the nearest cent).

a $589.26 b $1194 c $ 522.38 d. $459.20

Answer 1

Correct Answer:

Option D: $ 459.20

Working:

Moving average cost
	Inventory balance at end of day	Total cost	Average cost for each units
01-Jan	23	$              322.00	$               14.0
11-Jan	38	$              622.00	$               16.4
14-Jan	10	$              163.68	$               16.4
20-Jan	36	$              735.68	$               20.4

Weighted Average
Total Units Available for sale			64		$            1,194.00
Units Sold			28
Ending Inventory Units			36
Valuation
Cost of Goods Sold		28		$                           16.4	$               459.20
Cost of Goods Sold		28	units		$               459.20

End of answer.

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