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Cornerstones of Financial Accounti...

4th Edition
Jay Rich + 1 other
ISBN: 9781337690881

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Cornerstones of Financial Accounti...

4th Edition
Jay Rich + 1 other
ISBN: 9781337690881
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Chapter 6, Problem 24CE, Inventory Costing: Average Cost Refer to the information for Filimonov Inc. and assume that the

Inventory Costing: Average Cost

Refer to the information for Filimonov Inc. and assume that the company uses a perpetual inventory system.

Required:

Calculate the cost of goods sold and the cost of ending inventory using the average cost method. ( Note: Use four decimal places for per-unit calculations and round all other numbers to the nearest dollar.)

To determine

Concept introduction:

Average method:

Under this method, the cost per unit of the inventory is calculated as weighted average cost per unit and the cost of goods sold and inventory is calculated with the help of weighted average cost per unit.

To calculate:

The Cost of goods sold and ending inventory using the perpetual average cost method.

Explanation

The Cost of goods sold and ending inventory using the perpetual average cost method is calculated as follows:

Filimonov Inc.
Perpetual Inventory Record-Average Cost
Purchases Cost of Goods Sold Inventory Balance
Date Unit Rate Total Cost Unit Rate Total Cost Unit Rate Total Cost
June. 1 200 $ 10.0000 $ 2,000
June. 9 300 $ 12 $ 3,600 200 $ 10.0000 $ 2,000
300 $ 12...

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