Exercise 8-14 Inventory cost flow methods; perpetual system [LO8-1, 8-4]

Altira Corporation uses a perpetual inventory system. The following transactions affected its merchandise inventory during the month of August 2018:

Aug.1	Inventory on hand2,700 units; cost $6.80 each.
8	Purchased 13,500 units for $6.20 each.
14	Sold 10,800 units for $12.70 each.
18	Purchased 8,100 units for $5.60 each.
25	Sold 9,800 units for $11.70 each.
31	Inventory on hand3,700 units.

Exercise 8-14 Part 3

3. Determine the inventory balance Altira would report in its August 31, 2018, balance sheet and the cost of goods sold it would report in its August 2018 income statement using the Average cost method.

Perpetual Average	Inventory on hand			Cost of Goods Sold			Inventory Balance
	# of units	Cost per unit	Inventory Value	# of units sold	Avg.Cost per unit	Cost of Goods Sold	# of units in ending inventory	Cost per unit	Ending inventory
Beginning Inventory	2,700	$6.80	$18,360
Purchase - August 8	13,500	$6.20	83,700
Sale - August 14				10,800	$6.30	$68,040	5,400	$6.30	$34,020
Purchase - August 18	8,100	$5.60	45,360
Sale - August 25				9,800			3,700
Total	24,300		$147,420	20,600		$68,040