Question

Coronado's Place recorded the following data:
    
Date Unit Received Sold On Hand Unit Cost
1/1 Inventory    540 $2.80
1/8 Purchased 960  1500 2.30
1/12 Sold  1300 200 

The weighted average unit cost of the inventory at January 31 is:

Answer 1

Answer:

The weighted average unit cost of the inventory at January 31 is $496

Explanation:

Weighted Average unit cost the average cost of units on hand on each day. It is calculated by dividing total inventory value by total available units.

Date                    Unit Received / Sold  On Hand Unit     Cost   Balance

1/1       Inventory     540 units at $2.80          540             $1,512    $1,512

1/8      Purchased   960 units at $2.3           1500            $2208   $3,720

1/12      Sold            1,300 at ($3,720/1500)   200             $3,224   $496