ACCA FA2 VALUE OF SALES 2

At 1 January 20X3 Wasan had 900 units of a particular item in inventory. These were valued at $600 per unit. During January, the purchase and sales of the item were:

Date Units Price per unit Sales (units)
5 Jan 450
10 Jan 100 540
17 Jan 300
22 Jan 700 486
28 Jan 600

Wasan values inventory on the periodic weighted average basis.

What is the value of Wasan's inventory at 31 January 20X3 (to the nearest $1)?

ACCA FA2  VALUE OF SALES 2

Suggested Solution.

No of units available for sales

= 900 + 100 +700

=1700

No of units sold during the month

=450 +300 +600

=1350

No of units at the end of the month

= 1700 -1350

=350 Units

Periodic weighted average rate computation

Date Units Price per unit Value
1 Jan 900 600 540,000
10 Jan 100 540 54,000
22 Jan 700 486 340,200
Total 1,700 934,200
Unit price 550
Month end Unit 350
Inventory Value 192,335

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