Weighted Average Cost Method with Perpetual InventoryThe beginning inventory for Midnight Supplies and data on purchases and sales for a three-month period are as follows:DateTransactionNumberof UnitsPer UnitTotalJan. 1Inventory7,500$75.00$562,50010Purchase22,50085.001,912,50028Sale11,250150.001,687,50030Sale3,750150.00562,500Feb. 5Sale1,500150.00225,00010Purchase54,00087.504,725,00016Sale27,000160.004,320,00028Sale25,500160.004,080,000Mar. 5Purchase45,00089.504,027,50014Sale30,000160.004,800,00025Purchase7,50090.00675,00030Sale26,250160.004,200,000Required:1. Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illustrated in Exhibit 5, using the weighted average cost method. Round unit cost to two decimal places, if necessary. Round all total cost amounts to the nearest dollar.Midnight SuppliesSchedule of Cost of Goods SoldWeighted Average Cost MethodFor the Three Months Ended March 31 PurchasesCost of Goods SoldInventoryDateQuantity Unit CostTotal CostQuantity Unit CostTotal CostQuantity Unit CostTotal CostJan. 1$$Jan. 10$$ Jan. 28$$ Jan. 30  Feb. 5  Feb. 10  Feb. 16  Feb. 28  Mar. 5  Mar. 14  Mar. 25  Mar. 30  Mar. 31Balances$$2. Determine the total sales, the total cost of goods sold, and the gross profit from sales for the period.Total sales$Total cost of goods sold$Gross profit$3. Determine the ending inventory cost as of March 31.$

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Asked Dec 6, 2019
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Weighted Average Cost Method with Perpetual Inventory
The beginning inventory for Midnight Supplies and data on purchases and sales for a three-month period are as follows:
Date

Transaction
Number
of Units
Per Unit
Total
Jan. 1

Inventory
7,500

$75.00

$562,500

10

Purchase
22,500

85.00

1,912,500

28

Sale
11,250

150.00

1,687,500

30

Sale
3,750

150.00

562,500

Feb. 5

Sale
1,500

150.00

225,000

10

Purchase
54,000

87.50

4,725,000

16

Sale
27,000

160.00

4,320,000

28

Sale
25,500

160.00

4,080,000

Mar. 5

Purchase
45,000

89.50

4,027,500

14

Sale
30,000

160.00

4,800,000

25

Purchase
7,500

90.00

675,000

30

Sale
26,250

160.00

4,200,000

Required:
1. Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illustrated in Exhibit 5, using the weighted average cost method. Round unit cost to two decimal places, if necessary. Round all total cost amounts to the nearest dollar.
Midnight Supplies
Schedule of Cost of Goods Sold
Weighted Average Cost Method
For the Three Months Ended March 31

Purchases
Cost of Goods Sold
Inventory
Date
Quantity
Unit Cost
Total Cost
Quantity
Unit Cost
Total Cost
Quantity
Unit Cost
Total Cost
Jan. 1





$
$
Jan. 10

$
$


 

Jan. 28


$
$

 

Jan. 30


 

 


Feb. 5


 

 


Feb. 10

 



 

Feb. 16


 

 


Feb. 28


 

 


Mar. 5

 



 

Mar. 14


 

 


Mar. 25

 



 

Mar. 30


 

 


Mar. 31
Balances




$


$
2. Determine the total sales, the total cost of goods sold, and the gross profit from sales for the period.
Total sales
$
Total cost of goods sold
$
Gross profit
$
3. Determine the ending inventory cost as of March 31.
$

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Expert Answer

Step 1

In the weighted average method, the average costs are determined by adding the cost of inventory and cost of purchases and then dividing it by sum of inventory units and inventory purchased

Step 2

The inventory schedule has been prepared as follows

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Midnight Supplies Schedule of Cost of goods sold Weighted Average Cost Method For the three Months Ended March 31 Purchases Cost of goods Sold Inventory Unit Cost Total Cost Quanity Unit Cost Total Cost Workings for average cost Quanity Unit Cost Total Cost Quanity Date 1-Jan 7500 75 562500 82.5=(562500+1912500)/(7500+22500) 22500 85 1912500 2475000 10-Jan 30000 82.5 928125 1546875 28-Jan 11250 82.5 18750 82.5 3750 30-Jan 82.5 309375 15000 82.5 1237500 1113750 5-Feb 1500 82.5 123750 13500 82.5 86.5=(1113750+4725000)/(13500+54000) 54000 10-Feb 4725000 86.5 5838750 87.5 67500 16-Feb 27000 86.5 2335500 40500 86.5 3503250 28-Feb 25500 86.5 2205750 15000 86.5 1297500 60000 5325000 89.5 88.75 5-Mar 45000 4027500 2662500 30000 14-Mar 88.75 2662500 30000 88.75 25-Mar 37500 7500 90 675000 89 3337500 30-Mar 26250 89 2336250 11250 89 1001250 10901250 11340000 Total

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Step 3

The sale value of goods has bee...

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Sales Date Quanity Unit Cost Total Cost 1-Jan 10-Jan 11250 150 1687500 28-Jan 30-Jan 3750 150 562500 5-Feb 1500 150 225000 10-Feb 160 4320000 160 408000o 16-Feb 27000 28-Feb 25500 5-Mar 14-Mar 160 4800000 30000 25-Mar 160 4200000 30-Mar 26250 Total 19875000

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