ACCA FA2 VALUE OF SALES 2

At 1 January 20X3 Wasan had 900 units of a particular item in inventory. These were valued at $400 per unit. During January, the purchase and sales of the item were:

Date Units Price per unit Sales (units)
5 Jan 450
10 Jan 500 360
17 Jan 800
22 Jan 300 324
28 Jan 100

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 + 500 +300

=1700

No of units sold during the month

=450 +800 +100

=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 900 400 360,000
10 Jan 500 360 180,000
22 Jan 300 324 97,200
Total 1,700 637,200
Unit price 375
Month end Unit 350
Inventory Value 131,188

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