Given the following data, calculate the cost of goods sold using the average-cost method. Round average cost per unit calculations to two decimal places. Round final answer to the nearest dollar. Date Item Unit 1/1 Beginning inventory 70 units at $20 per unit5/10 Purchase of inventory 20 units at $ $20 per unit 10/9 Purchase of inventory 20 units at $ $32 per unit12/31 Ending inventory 28 units

The cost of goods sold using the average-cost method is $1,818.76

Explanation:

The computation of the average cost per unit is shown below:

= (Beginning inventory units * price per unit + purchase inventory units * price per unit + purchase inventory units * price per unit) : (Beginning inventory units + purchase inventory units + purchase inventory units)

= (70 units * $20 + 20 units * $20 + 20 units * $32) : (70 units + 20 units + 20 units)

= ($1,400 + $400 + $640 units) : (110 units)

= ($2,440 units) : (110 units)

= $22.18 per unit

Now the cost of goods sold equals to

= (Beginning inventory units * average cost per unit + purchase inventory units * average cost per unit - ending inventory units * average cost per unit)

= 70 units * $22.18 per unit + 40 units * $22.18 per unit - 28 units * $22.18 per unit

= $1552.60 + $887.20 - $621.04

= $1,818.76

The purchase units = 20 units + 20 units = 40 units