Eneri Company's inventory records show the following data: A physical inventory on December 31 shows 4,000 units on hand. Eneri sells the units for $13 each. The company has an effective tax rate of 20%. Eneri uses the periodic inventory method. The weighted-average cost per unit is

Question

Eneri Company's inventory records show the following data:  A physical inventory on December 31 shows 4,000 units on hand. Eneri sells the units for $13 each. The company has an effective tax rate of 20%. Eneri uses the periodic inventory method. The weighted-average cost per unit is

Quizplus · Accepted Answer

First, we need to calculate the cost of goods sold (COGS):
COGS = beginning inventory + purchases - ending inventory
COGS = (5,000 units x $8.25) + ($30,000 / $8.50 x 2 months) - (4,000 units x $8.24)
COGS = $41,250 + $7,058.82 - $32,960
COGS = $15,348.82

Next, we can calculate the gross profit:
Gross profit = revenue - COGS
Gross profit = (4,000 units x $13) - $15,348.82
Gross profit = $18,652.18

Lastly, we can calculate the net income:
Net income = gross profit x (1 - tax rate)
Net income = $18,652.18 x (1 - 0.20)
Net income = $14,921.74

To calculate the weighted-average cost per unit, we need to divide the total cost of goods available for sale ($41,250 + $30,000) by the total number of units available for sale (5,000 + 4,000) to get an average cost per unit of $8.25. Therefore, the answer is (C), $8.24, which is closest to the average cost per unit.

Eneri Company's Inventory Records Show the Following Data: a Physical