Question

Megaton, a distributor for Nuka Cola, sells Nuka Cola to grocery stores around the world. The cost of each case depends on when Megaton purchases the cola. See the cost structure below:

Mar. Purchases 12 cases @ $30
Jul. Purchases 25 cases @ $40
Aug Purchases 40 cases @ $50

Spec’s sells 42 cases in September.

What is the Cost of Goods Sold under the Weighted Average method? (answer choices)

Group of answer choices

A. 1,610

B. 1,833

C. 2,080

D. 3,360

Answer 1

Solution:
	WEIGHTED AVERAGE METHOD
			COST OF GOODS AVAILABLE FOR SALE	COST OF GOODS SOLD	CLOSING STOCK
	Date	Particulars	Units	Cost Per unit	Total	No. of Kg	Cost Per unit	Cost of Goods Sold	No. of Kg	Cost Per unit	Ending inventory
	March	Purchases	12	$             30.00	$                     360
	July	Purchases	25	$             40.00	$                  1,000
	Aug	Purchases	40	$             50.00	$                  2,000
		Total Goods Available For sale / Avg. Price	77	43.64	3,360	42	43.64	1,833	35	43.64	1,527
		Answer = Option B = $ 1833