Answer:
Cost of goods sold = $5,650
Explanation:
Total number of units sold = Beginning inventory + Purchase of raw materials - Ending Inventory
Total number of units sold = 1,000 units + 5,000 units - 1,000 units
Total number of units sold = 5,000 units
Beginning Inventory = 1,000 units × $1.00 per unit = $1,000
Purchase = 5,000 units × $1.16 per unit = $5,800
Total ending inventory before the sale but after the purchase of new inventory = 1,000 units + 5,000 units = 6,000 units
Total ending inventory cost before the sale but after the purchase of new inventory = $1,000 + $5,800 = $6,800
We know, weighted average cost method = Total cost ÷ Total inventory
weighted average cost method = $6,800 ÷ 6,000 units
weighted average cost method = $1.13 (rounded to nearest dollar)
Therefore, cost of goods sold = Total number of units sold × cost per unit
cost of goods sold = 5,000 units × $1.13 = $5,650
