The beginning inventory for Dunne Co. and data on purchases and sales for a three-month period are shown in Problem 7-1B.

The beginning inventory for Dunne Co. and data on purchases and sales for a three-month period are shown in Problem 7-1B.

Instructions

1. Record the inventory, purchases, and cost of merchandise sold data in a perpetual inventory record similar to the one illustrated in Exhibit 5, using the weighted average cost method.

2. Determine the total sales, the total cost of merchandise sold, and the gross profit from sales for the period.

3. Determine the ending inventory cost on June 30.

Answer:

1.

Unit Total Total Total

Quantity Cost Cost Quantity Unit Cost Cost Quantity Unit Cost Cost

 Apr. 325 1,200 30,000

8 75 1,240 93,000100 1,230 123,000

1140 1,230 49,200 60 1,230 73,800

3030 1,230 36,900 30 1,230 36,900

 May 8 60 1,260 75,60090 1,250 112,500

1050 1,250 62,500 40 1,250 50,000

1920 1,250 25,000 20 1,250 25,000

28 80 1,260 100,800100 1,258 125,800

 June 540 1,258 50,320 60 1,258 75,480

1625 1,258 31,450 35 1,258 44,030

21 35 1,264 44,24070 1,261 88,270

2844 1,261 55,484 26 1,261 32,786

30  Balances310,854 32,786

2. Total sales…………………………………………………………… $525,250

Total cost of merchandise sold………………………………… 310,854

Gross profit…………………………………………………………… $214,396

*$525,250 = $80,000 + $60,000 + $100,000 + $40,000 + $90,000 + $56,250 + $99,000

3. $32,786 (26 units × $1,261)