Periodic Inventory System .. In chronological order, the inventory, purchases, a
ID: 2447334 • Letter: P
Question
Periodic Inventory System ..
In chronological order, the inventory, purchases, and sales of a single product for a recent month are as follows:
Units Amount per Unit
Jn 1 Beginning inventory 150 $30
4 Purchase 400 33
12 Purchase 800 36
16 Sale 1,300 60
24 Purchase 300 39
Find Ending Inventory, Cost of Goods sold, and Gross Margin for the Average-cost method.
Explanation / Answer
Average cost = (150+400+800+30) /(30+33+36+39)
= 1650 / 138
=$ 11.96 per unit
ending Inventory = 138 - 60 = 78
Ending Inventory = 11.96 * 78 =$ 932.88
COGS = 60*11.96 = $717.6
Gross margin = sales -COGS
= 1300 - 717.6
= 582.4