Question

Problem 6-8A (Part Level Submission) Mercer Inc. is a retailer operating in British Columbia. Mercer uses the perpetual inventory method. All sales returns from customers result in the goods being returned to inventory; the inventory is not damaged. Assume that there are no credit transactions; all amounts are settled in cash. You are provided with the following information for Mercer Inc. for the month of January 2019. Date Description Quantity Unit Cost or Selling Price January 1 Beginning inventory 100 $15 January 5 Purchase 140 18 January 8 Sale 110 28 January 10 Sale return 10 28 January 15 Purchase 55 20 January 16 Purchase return 5 20 January 20 Sale 90 32 January 25 Purchase 20 22 Collapse question part (a1) Incorrect answer. Your answer is incorrect. Try again. Calculate the Moving-average cost per unit at January 1, 5, 8, 10, 15, 16, 20, & 25. (Round answers to 3 decimal places, e.g. 5.252.) Moving-Average Cost per unit January 1 $Entry field with incorrect answer 17 January 5 $Entry field with incorrect answer 19.33 January 8 $Entry field with incorrect answer 23.31 January 10 $Entry field with incorrect answer 23.56 January 15 $Entry field with incorrect answer 23.35 January 16 $Entry field with incorrect answer 25.33 January 20 $Entry field with incorrect answer 25.39 January 25 $Entry field with incorrect answer 25.38

Answer 1

Here is the tabular presentation of the moving average cost/unit. The second column gives you the basis of calculation of that column.

Date	Description	Quantity	Unit Cost price	Value ($)	Closing value	Closing units	Moving average cost/unit
Given in the question	Given in the question	Given in the question	Transaction cost given in the question in case of purchase and purchase return; Last moving average cost/unit in case of Sale and sales return transaction	Quantity * Unit cost Price	Previous closing value + Value ($)	Previous date closing units + Quantity	Closing value / Closing Units
01-Jan	Beginning Inventory	100	15.000	1,500	1,500	100	15.000
05-Jan	Purchases	140	18.000	2,520	4,020	240	16.750
08-Jan	Sale	-110	16.750	-1,843	2,178	130	16.750
10-Jan	Sale Return	10	16.750	168	2,345	140	16.750
15-Jan	Purchases	55	20.000	1,100	3,445	195	17.667
16-Jan	Purchase return	-5	20.000	-100	3,345	190	17.605
20-Jan	Sale	-90	17.605	-1,584	1,761	100	17.605
25-Jan	Purchase	20	22.000	440	2,201	120	18.338

Hope this is self explanatory !!!