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formula for weighted average ratio. This formula adds all of the numbers and divides by the amount of numbers. The formula is as follows.
Weighted Average Cost Accounting Inventory Valuation Method from corporatefinanceinstitute.com
Using the weighted average formula we get Weighted Avg w 1 x 1 w 2 x 2 w 3 x 3 w 4 x 4 Weighted Avg 10 5 20 10 30 15 40 20 0005 002 0045 008 15. Lets Look at an Example. This shows the overall grade of Anand is 76.
The weighted harmonic mean on the other hand correctly weights each data point.
Each loans interest rate contributes to the weighted average in proportion to the loans percentage of the total debt. To get a weighted average of the price paid the investor multiplies 100 shares by 10 for year one and 50 shares by 40 for year two and then adds the results to get a total of 3000. Heres a list of the elements in the weighted average formula and what each mean. The simple average of the interest rates is 4529 275 2 36395.
