Answer:
Oriole Co.
Purchases Date Units Unit Cost Sales Units Average cost
July 1 4 $140 $140
July 6 3 $140
July 11 7 $150 $148.75
July 14 6 $148.75
July 21 8 $161 $159.64
July 27 5 $159.64
Explanation:
a) Data:
Purchases Date Units Unit Cost Sales Units
July 1 4 $140
July 6 3
July 11 7 $150
July 14 6
July 21 8 $161
July 27 5
Average cost per unit = Total cost divided by units available for sale. For July 1 and 6, the unit cost equal the average cost.
For July 11 and 14, the total cost = $140 + $1,050(7 * $150) = $1,190 and the average cost = $148.75 ($1,190/8 units).
For July 21 and 27, the total cost = $148.75 + $1,288 (8* $161) = $1,436.75 and the average cost = $159.64 ($1,436.75/9).
