ITPEC IP October 2024 Question 71
ITPEC IP October 2024 — Question 71 of 100
The ending inventory value is 1,400 yen. On April 8, the existing 100 units worth 1,000 yen and the purchased 100 units worth 1,400 yen produce 200 units worth 2,400 yen, so the moving-average unit price is 12 yen. Shipping 150 units leaves 50 units worth 50 × 12 = 600 yen. The April 29 purchase adds 50 units worth 800 yen, giving 100 units worth 600 + 800 = 1,400 yen and a new average of 14 yen.
Answer (c)
Why not others:
- (a), (b), and (d) do not preserve the 600-yen value remaining after the sale and add the full 800-yen purchase cost
Key rule: Under moving average, recalculate average cost after each purchase; a sale reduces quantity and inventory value at the current average cost but does not create a new average.
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