Ace Systems, Inc On 28 January, Ace Systems Sells 18 Units (10 Units

question 79

Multiple Choice

Ace Systems, Inc. uses a perpetual inventory system. The company’s beginning inventory of a particular product and its purchases during the month of January were as follows:
$\begin{array}{lcccc} & \text { Quantity } &\text { Unit Cost } & \text { Total Cost } \\\text { Beginning inventory (1 Jan.) } & 10&\$ 27.50 & \$ 275 \\\text { Purchase (15 Jan.) } & 15 & \$ 28.00 & \$ 420 \\\text { Purchase (23 Jan.) } & \underline{5} & \$ 29.00 & \$ 145 \\\quad \text { Total } & \underline{30}&& \underline{\$ 840}\end{array}$
On 28 January, Ace Systems sells 18 units (10 units from beginning inventory, 4 units from 15 Jan purchase, and 4 units from 23 Jan purchase) of this product. The other 12 units remain in inventory at 31 January.


-Assuming that Ace Systems uses the weighted average cost flow assumption, the cost of goods sold to be recorded at 28 January is:

• A) $504.
• B) $336.
• C) $499.
• D) Some other amount.

---

Definitions:

Common Stock

A type of security that represents ownership in a corporation, includes voting rights, and entitles the holder to dividends.

Recession

A temporary phase of economic downturn characterized by decreased trade and industrial activity, typically recognized by a decline in the Gross Domestic Product (GDP) for two consecutive quarters.

Expected Rate of Return

The anticipated percentage increase in value that an investment is predicted to generate over a specific time.

Expected Return

The average of all possible returns for an investment, weighted by the likelihood of each outcome.