Answer:
$3,480
Explanation:
November 1: Beginning inventory 116 units @ $28 (116 units, $3,248 value)
November 5: Purchased 108 units @ $30 (108 units, $3,240 value)
November 8: Purchased 58 units @ $31 (58 units, $1,798 value)
November 16: Sold 224 units @ $53
November 19: Purchased 58 units @ $33 (58 units, $1,914 value)
First step is to calculate the weighted average cost for all units the company purchased:
If we sum up all the costs for the 4 purchases, we have:
3248 + 3240 + 1798 + 1914 = $10,200
Now, how many units were bought in those 4 transactions?
116 + 108 + 58 + 58 = 340 units
Weighted average cost per unit?
10200 / 340 = $30 / unit
Now, how many units left in inventory at the end?
340 units purchased - 224 units sold = 116 units left
Each unit is considered to be worth $30, so
116 units * $30/unit = $3,480
Using the weighted average inventory method, the company's ending inventory would be reported at: $3,480
