4 oct Opening balance=500 units @Rs 20 each, 5 Oct:Purchase=1000 units @Rs 15 ,6 Oct Sales=500 units.What will be rate at which the sales unit will be valued as per weighted avg method?
A)Rs20
B)Rs 15
C)Rs 16.66
D)17.5

Question

Quizplus · Accepted Answer

The weighted average cost per unit is calculated by adding the cost of the existing inventory to the cost of the new purchases and then dividing by the total number of units. Here, (500 units * Rs 20) + (1000 units * Rs 15) = Rs 10,000 + Rs 15,000 = Rs 25,000 total cost for 1500 units. So, Rs 25,000 / 1500 units = Rs 16.66 per unit.

4 Oct Opening Balance=500 Units @Rs 20 Each, 5 Oct:Purchase=1000