 248 let's just double-check that and 2948. Yes indeed. It is correct okay, so more time passes we're imagining and Sales are happening over here on the Shopify store and they're ticking down the sales numbers in terms of units as they happen But we're not worried about recording a decrease to the inventory on our financials yet because we're only going to do that Periodically at the end of the month However, we are concerned with the units of the sales as they tick down and we're going to make purchases You know as we need to to try to meet The demand so we're gonna say okay We think based on what the store is saying here that based on the units we need to buy some more units So I'm gonna go okay. We're gonna. Let's see which units we need to buy on 515 and this is gonna be product number one again Let's say on 515 we buy two more units and this time they cost $27 notice the cost per unit is rising I'm just it might not rise this rapidly But typically the cost will rise as time passes because of inflation and whatnot and that's why you need the flow assumptions So if I copy let's just copy this down and there we have it So now we purchased two times 27 each it's gonna cost us $54 ending inventory was at 138 plus the 54 is now at the 192 for product number one and then product number two We also purchased this time Let's say we purchased three units of Product number two. So let's say I'm just gonna put it here Product two and we're gonna purchase three units So the total units are up to five now for product number two and then Hold on a second. I don't want it here that happened on 515. So let's put it here product Two and then here's my two. Okay, and then so everything's carrying down four units total now and then nothing's here and then I'm gonna copy this down and It's doing nothing because because this is a purchase and not a sales item and then the the total cost Actually, this needs to be what am I doing here? This needs to be then What we purchased them for we we purchased them for 111 so the cost went up We had to pay 105 per unit now. We're paying 111 per unit. Okay, and then there's the total two units times 111 gets us 222 ending balance is the 210 plus the 222 gives us the 432 ending balance for product number two and then product number three did we buy any product number three on We did we're gonna say product three We also purchased and we're gonna purchase three of those and they cost us now 675 To purchase those ones so they went up again inflation happening hit us again I'm gonna copy this one down and then total cost is three units times 675 Prior balance plus the current change gives us this number and then our totals which are the ending balances There's where we stand Each of the ending balance for product one two and three and here's the change that happened in other words This is the purchase price. So we're purchasing 2301 of inventory which we're breaking out on a per unit basis for products one two and three So that's what we have thus far. So I'm gonna just pay I'm gonna imagine we buy it all from vendor one We might have multiple vendors that we buy different types of products from But I'm gonna imagine we buy them all from vendor one here. So I'm gonna say all right we bought all this stuff to To put in our store and so we're gonna see it decrease the checking account again vendor number one and Vendor number one is we're making vendor number one rich and We're gonna say this is gonna be for the amount But we're getting rich too, so that's cool. I'm cool with that 2301 2301 2301 and So this is gonna decrease checking the other side's going into inventory. So we'll save and close it and Balance sheet it and run it Checking account going down other side Assets now up to five two four nine and that ties out here to our ending balance in our worksheet Five two four nine movie be to the end be in as they say All right, then so then let's say that at the end of the year then Or at the end of the month now we are going to we're going to do our physical count again So what's been happening is we've been selling our stuff on our third party Store here and their inventory tracking has been going up and down on a perpetual system And we're just recording the purchase side But not the sales side in our financial statement on a dollar amount using the weighted average method And now we're gonna say it's the end of the month So we're gonna do a periodic adjustment to make our financial statements correct periodically We're gonna look at the physical count as well as which could also be Reflected or shown here on the Shopify as we manage our physical count of Inventory and the difference between the physical count and what's in our books at this point in times in terms of units We imagine we sold those right so that's the periodic system So we're gonna say okay, then let's go back on over and and say this happens on 531 We're gonna adjust our books with a journal entry product number one and we're gonna imagine That we only have four units left. We've counted our inventory We looked at the physical count and the Shopify count in units. We got four units left I have eight units here. That means we decreased the units by four We sold four units to get the unit count down to four And then we're not gonna have any buying thing because we didn't purchase anything So I'll keep that at zero or am I just put a zero into the field and then I'm gonna copy this down Now look what it's doing because we have our fancy formula. It's it's now saying hey look this because that's zero Or less than zero I'm going to do this number Which is our which is our ending balance right before this this? Transaction divided by the number of units, so we've been buying stuff It cost us $20 22 23 and so on up to $27 the average at this point in time is the ending inventory for product number one Divided by the number of units before we selling them at this point, which is about $24 right and then we've got our total ending balance Which is going to be? now it's this 20 so it's C9 C9 times E9, but there's nothing in E9, so it's C9 Times F9 so it's these two are what's being calculated here The second half of that formula and then the ending balance is the 192 minus because it's a negative number Gets us to the 96 remaining Okay, we also did we sell any we didn't even sell any of product number two which is a bust no one wants it No one wants product product to no one wants you See all that rhymed product to no one wants you oh burned Burned the product to okay So we got product number three and we're gonna imagine that We have Two units left so we checked out our physical count and what's on our Shopify physical count two units left So we have to say seven minus two that means we sold five units five units brings us down to two Seven minus five gives us the two nothing here. I'm gonna copy this formula down Which is gonna do this gonna say that was zero. So what I want you to do then is to take the 4625 the total Value of the inventory Divided by how many units we had before this transaction and that gives us an average cost of The 6 6 oh remember they cost us six 50 and in 675 but the weighted average 6 6 oh at this time So then we're gonna say that means that this times that