1. **Problem Statement:** Calculate the value of closing stock for Karioki Enterprises using the weighted average method based on the given purchase and issue transactions. 2. **Formula and Explanation:** The weighted average cost per unit after each purchase or issue is calculated as: $$\text{Weighted Average Cost} = \frac{\text{Cost of Beginning Inventory} + \text{Cost of Purchases}}{\text{Units in Beginning Inventory} + \text{Units Purchased}}$$ When units are issued, the cost of issued units is calculated using the current weighted average cost. 3. **Step-by-step Ledger Card Calculation:** | Date | Transaction | Units In | Unit Cost | Total Cost | Units Out | Cost of Units Out | Balance Units | Balance Cost | |-------|-------------|----------|-----------|------------|-----------|-------------------|---------------|--------------| | Jan 1 | Beginning Inventory | 100 | 10 | 1000 | 0 | 0 | 100 | 1000 | | Jan 3 | Purchase | 120 | 11 | 1320 | 0 | 0 | 220 | 2320 | | Jan 5 | Issue | 0 | - | - | 200 | $200 \times \frac{2320}{220} = 2109.09$ | 20 | $2320 - 2109.09 = 210.91$ | | Jan 8 | Purchase | 150 | 12 | 1800 | 0 | 0 | 170 | $210.91 + 1800 = 2010.91$ | | Jan 9 | Issue | 0 | - | - | 100 | $100 \times \frac{2010.91}{170} = 1182.30$ | 70 | $2010.91 - 1182.30 = 828.61$ | | Jan 13 | Purchase | 200 | 11 | 2200 | 0 | 0 | 270 | $828.61 + 2200 = 3028.61$ | | Jan 17 | Issue | 0 | - | - | 80 | $80 \times \frac{3028.61}{270} = 897.70$ | 190 | $3028.61 - 897.70 = 2130.91$ | | Jan 19 | Issue | 0 | - | - | 90 | $90 \times \frac{2130.91}{190} = 1009.91$ | 100 | $2130.91 - 1009.91 = 1121.00$ | | Jan 21 | Purchase | 160 | 13 | 2080 | 0 | 0 | 260 | $1121.00 + 2080 = 3201.00$ | | Jan 25 | Purchase | 100 | 12 | 1200 | 0 | 0 | 360 | $3201.00 + 1200 = 4401.00$ | | Jan 28 | Issue | 0 | - | - | 160 | $160 \times \frac{4401.00}{360} = 1956.00$ | 200 | $4401.00 - 1956.00 = 2445.00$ | | Jan 30 | Purchase | 120 | 13 | 1560 | 0 | 0 | 320 | $2445.00 + 1560 = 4005.00$ | | Jan 31 | Issue | 0 | - | - | 80 | $80 \times \frac{4005.00}{320} = 1001.25$ | 240 | $4005.00 - 1001.25 = 3003.75$ | 4. **Final Closing Stock:** Units remaining = 240 Value of closing stock = $3003.75$ 5. **Summary:** Using the weighted average method, the closing stock value for Karioki Enterprises on Jan 31 is $3003.75$. This method smooths out price fluctuations by averaging costs, providing a consistent valuation.