Required information
Problem 5-1A Perpetual: Alternative cost flows LO P1
[The following information applies to the questions
displayed below.]
Warnerwoods Company uses a perpetual inventory system. It entered
into the following purchases and sales transactions for
March.
Date | Activities | Units Acquired at Cost | Units Sold at Retail | |||||||||
Mar. | 1 | Beginning inventory | 130 | units | @ $51.60 per unit | |||||||
Mar. | 5 | Purchase | 240 | units | @ $56.60 per unit | |||||||
Mar. | 9 | Sales | 290 | units | @ $86.60 per unit | |||||||
Mar. | 18 | Purchase | 100 | units | @ $61.60 per unit | |||||||
Mar. | 25 | Purchase | 180 | units | @ $63.60 per unit | |||||||
Mar. | 29 | Sales | 160 | units | @ $96.60 per unit | |||||||
Totals | 650 | units | 450 | units | ||||||||
Problem 5-1A Part 3
3. Compute the cost assigned to ending
inventory using weighted average and specific identification. For
specific identification, the March 9 sale consisted of 80 units
from beginning inventory and 210 units from the March 5 purchase;
the March 29 sale consisted of 60 units from the March 18 purchase
and 100 units from the March 25 purchase.
I need weghted average and Specific ID.
Solution | ||||
Date | Transacton | Unit | Price | Cost |
Mar-01 | Opening Inventory | 130 | $ 51.60 | $ 6,708 |
Mar-05 | Purchase | 240 | $56.60 | $ 13,584 |
Mar-18 | purchase | 100 | $ 61.60 | $ 61,600 |
Mar-25 | Purchase | 180 | $ 63.60 | $ 11,448 |
Total | 650 | $ 37,900 | ||
Weighted average cost per unit = Total cost / Total unit | ||||
= $ 37,900 / 650 unit = | $ 58.3077 | |||
Valuation of inventory at closing = Closing unit x weighted average cost per unit | ||||
= 200 unit x $ 58.3077 | ||||
= $ 11661.54 | ||||
Note Closing Inventory = (Opening inventory + purchase) - sale unit | ||||
= 650 unit - 290 unit - 160 unit = 200 unit | ||||
Get Answers For Free
Most questions answered within 1 hours.