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From the following data, find out the gross profit on the inventory sold under weighted average price method
1st Jan – opening inventory – 1000 units @ Rs. 4 per unit
15th Jan – Purchases – 1100 units @ Rs. 5 per unit
30th Jan – Purchases – 1300 units @ Rs. 6 per unit
Sales during the month – 3000 units @ Rs. 10 per unit
1st Jan – opening inventory – 1000 units @ Rs. 4 per unit
15th Jan – Purchases – 1100 units @ Rs. 5 per unit
30th Jan – Purchases – 1300 units @ Rs. 6 per unit
Sales during the month – 3000 units @ Rs. 10 per unit
- a)Rs. 14,735
- b)Rs. 15,000
- c)Rs. 14,300
- d)Rs. 15,100
Correct answer is option 'A'. Can you explain this answer?
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From the following data, find out the gross profit on the inventory so...
Given Data:
- Opening inventory on 1st Jan: 1000 units @ Rs. 4 per unit
- Purchases on 15th Jan: 1100 units @ Rs. 5 per unit
- Purchases on 30th Jan: 1300 units @ Rs. 6 per unit
- Sales during the month: 3000 units @ Rs. 10 per unit
Step 1: Calculate Weighted Average Cost (WAC):
To calculate the weighted average cost, we need to find the total cost and total units of inventory.
Opening inventory cost = 1000 units * Rs. 4 per unit = Rs. 4000
Purchases on 15th Jan cost = 1100 units * Rs. 5 per unit = Rs. 5500
Purchases on 30th Jan cost = 1300 units * Rs. 6 per unit = Rs. 7800
Total cost = Opening inventory cost + Purchases on 15th Jan cost + Purchases on 30th Jan cost
= Rs. 4000 + Rs. 5500 + Rs. 7800
= Rs. 17300
Total units = Opening inventory units + Purchases on 15th Jan units + Purchases on 30th Jan units
= 1000 units + 1100 units + 1300 units
= 3400 units
Weighted average cost (WAC) = Total cost / Total units
= Rs. 17300 / 3400 units
= Rs. 5.0882 per unit (approx.)
Step 2: Calculate Cost of Goods Sold (COGS):
COGS = Units sold * WAC
= 3000 units * Rs. 5.0882 per unit
= Rs. 15264.60 (approx.)
Step 3: Calculate Gross Profit:
Gross Profit = Sales Revenue - COGS
= Units sold * Sales price - COGS
= 3000 units * Rs. 10 per unit - Rs. 15264.60
= Rs. 30,000 - Rs. 15264.60
= Rs. 14735.40 (approx.)
Therefore, the gross profit on the inventory sold under the weighted average price method is approximately Rs. 14735. Hence, option A is the correct answer.
- Opening inventory on 1st Jan: 1000 units @ Rs. 4 per unit
- Purchases on 15th Jan: 1100 units @ Rs. 5 per unit
- Purchases on 30th Jan: 1300 units @ Rs. 6 per unit
- Sales during the month: 3000 units @ Rs. 10 per unit
Step 1: Calculate Weighted Average Cost (WAC):
To calculate the weighted average cost, we need to find the total cost and total units of inventory.
Opening inventory cost = 1000 units * Rs. 4 per unit = Rs. 4000
Purchases on 15th Jan cost = 1100 units * Rs. 5 per unit = Rs. 5500
Purchases on 30th Jan cost = 1300 units * Rs. 6 per unit = Rs. 7800
Total cost = Opening inventory cost + Purchases on 15th Jan cost + Purchases on 30th Jan cost
= Rs. 4000 + Rs. 5500 + Rs. 7800
= Rs. 17300
Total units = Opening inventory units + Purchases on 15th Jan units + Purchases on 30th Jan units
= 1000 units + 1100 units + 1300 units
= 3400 units
Weighted average cost (WAC) = Total cost / Total units
= Rs. 17300 / 3400 units
= Rs. 5.0882 per unit (approx.)
Step 2: Calculate Cost of Goods Sold (COGS):
COGS = Units sold * WAC
= 3000 units * Rs. 5.0882 per unit
= Rs. 15264.60 (approx.)
Step 3: Calculate Gross Profit:
Gross Profit = Sales Revenue - COGS
= Units sold * Sales price - COGS
= 3000 units * Rs. 10 per unit - Rs. 15264.60
= Rs. 30,000 - Rs. 15264.60
= Rs. 14735.40 (approx.)
Therefore, the gross profit on the inventory sold under the weighted average price method is approximately Rs. 14735. Hence, option A is the correct answer.
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From the following data, find out the gross profit on the inventory sold under weighted average price method1st Jan – opening inventory – 1000 units @ Rs. 4 per unit15th Jan – Purchases – 1100 units @ Rs. 5 per unit30th Jan – Purchases – 1300 units @ Rs. 6 per unitSales during the month – 3000 units @ Rs. 10 per unita)Rs. 14,735b)Rs. 15,000c)Rs. 14,300d)Rs. 15,100Correct answer is option 'A'. Can you explain this answer?
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From the following data, find out the gross profit on the inventory sold under weighted average price method1st Jan – opening inventory – 1000 units @ Rs. 4 per unit15th Jan – Purchases – 1100 units @ Rs. 5 per unit30th Jan – Purchases – 1300 units @ Rs. 6 per unitSales during the month – 3000 units @ Rs. 10 per unita)Rs. 14,735b)Rs. 15,000c)Rs. 14,300d)Rs. 15,100Correct answer is option 'A'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about From the following data, find out the gross profit on the inventory sold under weighted average price method1st Jan – opening inventory – 1000 units @ Rs. 4 per unit15th Jan – Purchases – 1100 units @ Rs. 5 per unit30th Jan – Purchases – 1300 units @ Rs. 6 per unitSales during the month – 3000 units @ Rs. 10 per unita)Rs. 14,735b)Rs. 15,000c)Rs. 14,300d)Rs. 15,100Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for From the following data, find out the gross profit on the inventory sold under weighted average price method1st Jan – opening inventory – 1000 units @ Rs. 4 per unit15th Jan – Purchases – 1100 units @ Rs. 5 per unit30th Jan – Purchases – 1300 units @ Rs. 6 per unitSales during the month – 3000 units @ Rs. 10 per unita)Rs. 14,735b)Rs. 15,000c)Rs. 14,300d)Rs. 15,100Correct answer is option 'A'. Can you explain this answer?.
From the following data, find out the gross profit on the inventory sold under weighted average price method1st Jan – opening inventory – 1000 units @ Rs. 4 per unit15th Jan – Purchases – 1100 units @ Rs. 5 per unit30th Jan – Purchases – 1300 units @ Rs. 6 per unitSales during the month – 3000 units @ Rs. 10 per unita)Rs. 14,735b)Rs. 15,000c)Rs. 14,300d)Rs. 15,100Correct answer is option 'A'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about From the following data, find out the gross profit on the inventory sold under weighted average price method1st Jan – opening inventory – 1000 units @ Rs. 4 per unit15th Jan – Purchases – 1100 units @ Rs. 5 per unit30th Jan – Purchases – 1300 units @ Rs. 6 per unitSales during the month – 3000 units @ Rs. 10 per unita)Rs. 14,735b)Rs. 15,000c)Rs. 14,300d)Rs. 15,100Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for From the following data, find out the gross profit on the inventory sold under weighted average price method1st Jan – opening inventory – 1000 units @ Rs. 4 per unit15th Jan – Purchases – 1100 units @ Rs. 5 per unit30th Jan – Purchases – 1300 units @ Rs. 6 per unitSales during the month – 3000 units @ Rs. 10 per unita)Rs. 14,735b)Rs. 15,000c)Rs. 14,300d)Rs. 15,100Correct answer is option 'A'. Can you explain this answer?.
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