two items are purchased: 100 packs of felt pens at $4 each and 60 packs of felt pens at $3.80 each. (a pack…

two items are purchased: 100 packs of felt pens at $4 each and 60 packs of felt pens at $3.80 each. (a pack contains 3 felt pens). find the ending inventory value if 50 packs were on hand at the end of the period.

two items are purchased: 100 packs of felt pens at $4 each and 60 packs of felt pens at $3.80 each. (a pack contains 3 felt pens). find the ending inventory value if 50 packs were on hand at the end of the period.

Answer

Explanation:

Step1: Calculate total number of packs purchased

$100 + 60=160$

Step2: Calculate weighted - average cost per pack

The total cost of the first purchase is $100\times4 = 400$ dollars. The total cost of the second purchase is $60\times3.80=228$ dollars. The total cost of all purchases is $400 + 228=628$ dollars. The weighted - average cost per pack is $\frac{628}{160}=3.925$ dollars per pack.

Step3: Calculate ending inventory value

The ending inventory value is the number of packs on hand times the weighted - average cost per pack. $50\times3.925 = 196.25$

Answer:

$196.25$