Nordic Industries uses a periodic inventory system.During its first month of operations,Nordic Industries purchased inventory as follows: There were 100 units in ending inventory on January 31.
Under the weighted average cost method,what is the cost of goods sold for January?
A)$18,000
B)$20,250
C)$3,150
D)$2,250

Question

Nordic Industries uses a periodic inventory system.During its first month of operations,Nordic Industries purchased inventory as follows:  There were 100 units in ending inventory on January 31.
Under the weighted average cost method,what is the cost of goods sold for January?
A)$18,000 
B)$20,250 
C)$3,150 
D)$2,250

Quizplus · Accepted Answer

Weighted average cost method:
Weighted average cost per unit = Cost of goods available for sale ÷ Number of units available for sale
= $20,250 ÷ 900 units = $22.50 per unit
Units sold = Units available for sale − Units in ending inventory
= 900 units − 100 units = 800 units
Cost of Goods Sold = Units in ending inventory × Weighted average cost per unit
= 800 units × $22.50 per unit = $18,000

Nordic Industries Uses a Periodic Inventory System