Question

Windrose, Inc. uses a periodic inventory system and its inventory records contain the following information: Units Total Cost Beginning inventory: 600 $ 1,560 Purchased on May 10 800 2,340 Purchased on June 15 1,000 2,520 Purchased on August 28 600 1,980 3,000 $ 8,400 The company sold 2,000 units during June. There were no additional purchases or sales during the remainder of the year. The company had 1,000 units were in its ending inventory at the end of the year. If Windrose uses the weighted average inventory costing method, what is the cost of its ending inventory

Answer 1

$2,800

Step-by-step explanation:

Given that

Total units = 3,000

Purchased inventory = $8,400

Ending inventory = 1,000 units

The computation of cost of its ending inventory is shown below:-

The per unit cost

= $8,400 ÷ 3,000

= 2.8 per unit cost

The cost of ending inventory using weighted average is calculated below

= Ending inventory × Per unit cost

= 1,000 units × 2.8

= $2,800