compute gross profit using the weighted - average inventory costing method. gross profit using the weighted…

compute gross profit using the weighted - average inventory costing method. gross profit using the weighted - average inventory costing method = \n\ntransactions\n\nmay 1, beginning merchandise inventory 24 tires @ $61 each\nmay 11, purchase 6 tires @ $76 each\nmay 23, sale 16 tires @ $83 each\nmay 26, purchase 14 tires @ $86 each\nmay 29, sale 17 tires @ $83 each

compute gross profit using the weighted - average inventory costing method. gross profit using the weighted - average inventory costing method = \n\ntransactions\n\nmay 1, beginning merchandise inventory 24 tires @ $61 each\nmay 11, purchase 6 tires @ $76 each\nmay 23, sale 16 tires @ $83 each\nmay 26, purchase 14 tires @ $86 each\nmay 29, sale 17 tires @ $83 each

Answer

Explanation:

Step1: Calculate total cost of goods available for sale

Total cost of beginning inventory = $24\times61=$1464$ Cost of May 11 purchase = $6\times76 = $456$ Cost of May 26 purchase = $14\times86=$1204$ Total cost of goods available for sale = $1464 + 456+1204=$3124$ Total number of units available for sale = $24 + 6+14=44$ units Weight - average cost per unit = $\frac{3124}{44}=$71$

Step2: Calculate cost of goods sold

Number of units sold = $16 + 17=33$ units Cost of goods sold = $33\times71=$2343$

Step3: Calculate total sales revenue

Sales revenue from May 23 sale = $16\times83=$1328$ Sales revenue from May 29 sale = $17\times83=$1411$ Total sales revenue = $1328 + 1411=$2739$

Step4: Calculate gross profit

Gross profit = Total sales revenue - Cost of goods sold Gross profit = $2739-2343=$396$

Answer:

$396$