Question

Eaton Electronics uses a periodic inventory system. On March 31, Eaton has two plasma TVs on hand at a cost of $1,500 each (serial numbers 11534892 and 11534894). In April, the company purchases four more identical TVs from Toshiba for $1,450 each (serial numbers 11542631 through 11542634). In May, the company purchases five more identical TVs for $1,600 each (serial numbers 11550964 through 11550968). In June, Eaton sells two of these TVs (serial numbers 11534894 and 11542631). There were no additional purchases or sales during the remainder of the year.

Eaton Electronics uses the weighted average method. What is the company's weighted average cost per unit? (Round the per unit cost to the nearestdollar.)

Multiple Choice

• $1,600

• $1,517

• $1,527

• $1,500

Answer 1

Answer:

Option C: $ 1527

Explanation:

Weighted Average
	Purchases	Sold	Balance
Date	Units	Rate	Amount	Units	Rate	Amount	Units	Rate	Amount
Opening							2	$      1,500	$        3,000
Purchased	4	$ 1,450.00	$        5,800				6	$ 1,466.67	8,800
Purchased	5	$ 1,600.00	$        8,000				11	$ 1,527.27	16,800
Sold				2	$ 1,527.27	$              3,055	9	$ 1,527.27	$      13,745

In case of any doubt, please comment.