The Dunedin supply yard uses weighted-average costing. Purchases are 80 units at $36.50, 140 units at $38.25, and 110 units at $39.10. What weighted-average unit cost should be used?
Correct Answer
D) $38.11
Weighted-average unit cost divides total cost by total units available.
Why This Is the Correct Answer
Weighted-average unit cost divides total cost by total units available.
Why the Other Options Are Wrong
Option A: $37.95
$37.95 is below the supported result for weighted-average inventory; it likely uses the wrong base, period, or account bucket.
Option B: $35.43
$35.43 is below the supported result for weighted-average inventory; it likely uses the wrong base, period, or account bucket.
Option C: $39.10
$39.10 is above the supported result for weighted-average inventory; it likely adds an unsupported amount or compares the wrong financial base.
Memory Technique
Weighted-Average drawer for Estimator Checks: label unit before counting dollars.
Reference Hint
Open-book path: tab Builder's Guide to Accounting, 2001 to Section Two, Inventory Costing, Weighted Average; use the job ledger figures in the stem and recompute the same accounting measure.
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