Marigold Company's inventory records show the following
data:
Units |
Unit Cost |
||
---|---|---|---|
Inventory, January 1 |
10000 | $9.20 | |
Purchases: June 18 |
8000 | 8.00 | |
November 8 |
6000 | 6.00 |
A physical inventory on December 31 shows 4300 units on hand.
Marigold sells the units for $11 each. The company has an effective
tax rate of 20%. Marigold uses the periodic inventory method. The
weighted-average cost per unit is
Calculation of cost of goods available for sale:
A | B | A x B | |
Units | Unit Cost | Total Cost | |
Jan .1 | 10,000 | $9.20 | $92,000 |
June.18 | 8,000 | $8.00 | $64,000 |
Nov.8 | 6,000 | $6.00 | $36,000 |
24,000 | $192,000 |
Cost of goods available for sale = $192,000
Number of units available for sale = 24,000
weighted-average cost per unit = Cost of goods available for sale/ Number of units available for sale
= 192,000/24,000
= $8
Kindly give a positive rating if you are satisfied with this solution and please ask if you have any query.
Thanks
Get Answers For Free
Most questions answered within 1 hours.