Accounting for Inventory - Weighted Average Example

The video tutorial explains how to use the weighted average method to calculate the cost of goods sold (COGS) for Delta Company. It emphasizes that the initial steps remain consistent across different methods. The tutorial provides a step-by-step guide to calculating COGS, recording journal entries, and determining gross profit. It concludes with calculating the ending inventory using the weighted average method.

What remains unchanged when using the weighted average method compared to other methods?

• The initial journal entries and sales revenue

• The number of units sold

• The calculation of cost of goods sold

• The ending inventory value

What is the first step in the weighted average method?

• Add up all the inventory costs

• Multiply each inventory quantity by its cost

• Divide the total cost by the number of units

• Subtract the cost of goods sold from sales revenue

How do you calculate the average cost per unit in the weighted average method?

• Add the cost of goods sold to the sales revenue

• Multiply the total cost by the number of units

• Divide the total cost by the total number of units

• Subtract the ending inventory from the total cost

What is the formula for calculating gross profit?

• Sales revenue minus cost of goods sold

• Total cost divided by the number of units

• Cost of goods sold plus sales revenue

• Ending inventory minus sales revenue

After selling 29 units, how many units remain in inventory?

• 29 units

• 18 units

• 0 units

• 47 units