Question

During 2021, a company sells 490 units of inventory for $90 each. The company has the following inventory purchase transactions for 2021:

Date		Transaction	Number of Units			Unit Cost			Total Cost
Jan.	1	Beginning inventory		79		$	70			$	5,530
May	5	Purchase		264			71				18,744
Nov.	3	Purchase		188			73				13,724
				531						$	37,998

Calculate cost of goods sold and ending inventory for 2021 assuming the company uses the weighted-average cost method. (Round weighted-average unit cost to 4 decimal places. Round your final answers to the nearest dollar amount.)

Cost of goods sold:

Ending inventory:

Answer 1

Cost of Goods sold	=	$            35,064
Ending inventory	=	$              2,934

Explanation:

Calculation of cost of goods sold and ending inventory under Weighted Average Cost - Periodic system:-
	Average Cost per unit			=	Total Cost of Goods available for sale
					Total quantity
	Periodic -Weighted Average Cost	Cost of Goods Available for Sale			Cost of Goods Sold - Average Cost			Ending inventory - Average Cost
		# of Units	Cost per Unit	Cost of Goods Available for Sale	# of Units sold	Average Cost per Unit	Cost of Goods Sold	# of Units in Ending inventory	Average Cost per Unit	Ending inventory
	Beginning Inventory (Jan 1)	79	$                    70	$             5,530
	Purchases:
	May 5	264	$                    71	$           18,744
	Nov 3	188	$                    73	$           13,724
	Total	531	$         71.5593	$           37,998	490	$          71.5593	$        35,064	41	$      71.5593	2,934
	Average Cost per unit			=	$37,998
					531
				=	$71.5593
	Total No. of units sold	=			490
	Amount assigned to Cost of Goods sold	=	490 * $71.5593	=	$           35,064
	Units in ending inventory	=	531-490	=	41
	Amount assigned to ending inventory	=	41 * $71.5593	=	$             2,934
	Cost of Goods sold	=	$            35,064
	Ending inventory	=	$              2,934

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