Question

Weighted Average Cost Method with Perpetual Inventory

The beginning inventory for Midnight Supplies and data on purchases and sales for a three-month period are as follows:

Date		Transaction	Number of Units		Per Unit		Total
Jan. 1		Inventory	7,200		$71.00		$511,200
10		Purchase	21,600		81.00		1,749,600
28		Sale	10,800		142.00		1,533,600
30		Sale	3,600		142.00		511,200
Feb. 5		Sale	1,440		142.00		204,480
10		Purchase	51,840		83.50		4,328,640
16		Sale	25,920		152.00		3,939,840
28		Sale	24,480		152.00		3,720,960
Mar. 5		Purchase	43,200		85.50		3,693,600
14		Sale	28,800		152.00		4,377,600
25		Purchase	7,200		86.00		619,200
30		Sale	25,200		152.00		3,830,400

Required:

1. Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illustrated in Exhibit 5, using the weighted average cost method. Round unit cost to two decimal places, if necessary. Round all total cost amounts to the nearest dollar.

Midnight Supplies Schedule of Cost of Goods Sold Weighted Average Cost Method For the Three Months Ended March 31
	Purchases			Cost of Goods Sold			Inventory
Date	Quantity	Unit Cost	Total Cost	Quantity	Unit Cost	Total Cost	Quantity	Unit Cost	Total Cost
Jan. 1								$	$
Jan. 10		$	$
Jan. 28					$	$
Jan. 30
Feb. 5
Feb. 10
Feb. 16
Feb. 28
Mar. 5
Mar. 14
Mar. 25
Mar. 30
Mar. 31	Balances					$			$

2. Determine the total sales, the total cost of goods sold, and the gross profit from sales for the period.

Total sales	$
Total cost of goods sold	$
Gross profit	$

3. Determine the ending inventory cost as of March 31.

Answer 1

Answer to Requirement 1:

Answer to Requirement 2:

Total Sales = $1,533,600 + $511,200 + $204,480 + $3,939,840 + $3,720,960 + $4,377,600 + $3,830,400
Total Sales = $18,118,080

Total Cost of Goods Sold = $9,984,240

Gross Profit = Total Sales - Total Cost of Goods Sold
Gross Profit = $18,118,080 - $9,984,240
Gross Profit = $8,133,840

Answer to Requirement 3:

Ending Inventory = $918,000