Question

Monarch Company uses a weighted-average perpetual inventory system, and has the following purchases and sales: January 1 20 units were purchased at $10 per unit. January 12 12 units were sold. January 20 18 units were purchased at $11 per unit. What is the value of ending inventory? (Round average cost per unit to 2 decimal places and final answer to the nearest dollar.)

Answer 1

Answer:

The answer is: The value of ending inventory is $278

Explanation:

Date              Units purch. / sold     Unit price        Total purchase / sell

Jan. 1                 20 units               $10 per unit           $200

Jan. 12               -12 units               $10 per unit           -$120

Jan. 20              18 units                $11 per unit            $198

TOTAL               26 units               $10.69 per unit     $278

Using weighted average cost method, the inventory cost is $278, the average cost per unit is: $278 / 26 units = $10.69 per unit