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Q. Weighted-average under perpetual inventory procedure?

Weighted-average under perpetual inventory procedure in perpetual inventory procedure firms calculate a new weighted-average unit cost after each purchase by dividing total cost of goods available for sale by total units available for sale. The unit cost is a moving weighted-average for the reason that it changes after each purchase. In Exhibit you are able to see how to compute the moving weighted-average using perpetual inventory procedure. The new weighted-average unit cost computed subsequent to every purchase is the unit cost for inventory items sold until a new purchase is made. The entity cost of the 20 units in ending inventory is USD 8.929 for a total inventory cost of USD 178.58. Cost of goods sold in this procedure is USD 690 minus the USD 178.58 or USD 511.42.

Computer Engineering, Engineering

  • Category:- Computer Engineering
  • Reference No.:- M9568604

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