College Accounting (Book Only): A Career Approach
12th Edition
ISBN: 9781305084087
Author: Cathy J. Scott
Publisher: Cengage Learning
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Textbook Question
Chapter C, Problem 1P
Bean Nursery sells bark to its customers at retail. Bean buys bark from a plywood mill in bulk and transports the bark in its own trucks. Information relating to the beginning inventory and purchases of bark is as follows:
Required
Find the cost of 1,200 cubic yards in the ending inventory by the weighted-average-cost method. Carry average cost per cubic yard to four decimals.
Check Figure
Cost of ending inventory, $519.24
Expert Solution & Answer
To determine
Compute the cost of ending inventory using weighted-average-cost method.
Explanation of Solution
Weighted-average cost method: Under average cost method, company calculates a new average after every purchase. It is determined by dividing the cost of goods available for sale by the units on hand.
Compute the cost of ending inventory of 1,200 cubic yards using weighted-average-cost method.
Table (1)
Conclusion
Thus, the cost of 1,200 cubic yards using weighted-average-cost is $519.24.
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Chapter C Solutions
College Accounting (Book Only): A Career Approach
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