Sawyer Company uses the perpetual inventory system and the moving-average method to value inventories.On August 1, there were 10,000 units valued at $30,000 in the beginning inventory.On August 10, 20,000 units were purchased for $6 per unit.On August 15, 24,000 units were sold for $12 per unit.The amount charged to cost of goods sold on August 15 was

Question

Quizplus · Accepted Answer

First, we need to calculate the weighted-average cost per unit:

Total cost of beginning inventory = $30,000 
Total cost of purchased inventory = $6 * 20,000 = $120,000 
Total units available = 10,000 + 20,000 = 30,000

Weighted-average cost per unit = ($30,000 + $120,000) / 30,000 = $5

Therefore, the cost of goods sold on August 15 is:

24,000 units sold * $5 weighted-average cost per unit = $120,000

So, the correct answer is C.

Sawyer Company Uses the Perpetual Inventory System and the Moving-Average