Question

Sage Hill Inc. uses a periodic inventory system reports the following for the month of June.

Date		Explanation		Units		Unit Cost		Total Cost
June 1		Inventory		120		$5		$600
12		Purchases		360		6		2,160
23		Purchases		210		7		1,470
30		Inventory		300

A sale of 340 units occurred on June 15 for a selling price of $9 and a sale of 50 units on June 27 for $10.

(a)

Partially correct answer iconYour answer is partially correct.

Calculate the average cost per unit, using a perpetual inventory system. (Round intermediate calculations to 0 decimal places, e.g. 5.250 and final answer to 3 decimal places, e.g. 5.125.)

June 1		$enter a dollar amount
June 12		$enter a dollar amount
June 15		$enter a dollar amount
June 23		$enter a dollar amount
June 27		$enter a dollar amount

Answer 1

Calculating Average cost per unit.

:: On June - 1st.

>> Average cost per unit = $ 5.

:: On June 12th

>> Average cost per unit = ( $ 600 + $ 2,160 ) / ( 120 + 360 )

>> Average cost per unit = $ 5.75.

:: On June 15th

>> Average cost per unit = $ 5.75

:: On June 23rd

>> Average cost per unit = [ ( 140 * $ 5.75 ) + $ 1,470 ) / ( 140 + 210 )

>> Average cost per unit = $ 6.5.

:: On June 27th

>> Average cost per unit = $ 6.5