David Corporation has just completed a physical inventory count st year end, December

31, 2022. Only the items on the shelves, in storage, and in the receiving area were

counted The inventory amourted to $97,000 David Co uses a perpetual inventory

system. During the audit, the independent, CPA disoovered the tollowing additional

information:

(a) There were goods in transit on December 31, 2022, from a suppler win terms FOB

destination, costing $10,000. Sine the goods had not arrived, thay were excluded

from the physical inventory count

(p) On December 27. 2022, a regular customer purchased goods for cash amounting to

$1,000 and aft them for pickup on January 4, 2023. David Corporation had paid

$500 for the goods and, because they were on hand, included them in the ptiysical

inventory count.

(c) David Corporation, on the date of the inventory courk, recelved notice from a supplier

that goods ordered earler, at a cost of $4,000, had been delivered to the

transportation company on December 28, 2022, the terms were FOB shipping point

Because the shipment had not arrived on December 31, 2022 it was excluded from

the physical inventory.

(d) On December 31, 2022, there were goods in transit to customers, with terms FOB

shipping point, amounting to $500 (expected delivery on January 8, 2023). The

goods were stipped and excluded from the physical inventary count.

I

(e) On December 31, 2022, David Corporation shipped $2,500 worth of gods to a

customer, FOB destination on January 5, 2023. The goods were not on hand, and

not included in the physical inventory count.

(1) David Corporation, as the consignet, had goods on consigrment that cast $5,000.

These goods were on hand as of December 31, 2022 and krere includad in the

physical inventory count.

Instructions - 13 marks

Analyze the above information and calculate the correct ending inventory value. Show

your work. Briefly explain your rationale for how you decided to handle each of the item

(a) through (f)

David Corporation has just competed a physical entory court a year end. December 31, 2022. Only the tems on the shelves in storage, and in the receiving area were counted. The intory amounted to $97.000. David Causes a perpen hertory system. During the suit the independent CPA discovered the following additional information (a) There were goots in an on December 31, 2022. to a supplies with loma FOS coration, couting $10.000. Since the goods had not atved, they would from the physical inventory court foy on December 27 2022. a regular customer purchased goods for cush mounting to $1,000 and let them for pickup on January 4, 2023. David Corporition had ped $500 for the goods and because tey wonten inguted them in the physica Inventory court c) David Corporation on the date of the inventory court, ved not om die that gets ordered easier, o act of $4.000 had been delivered to the transporation company on December 20, 2022. The term we FOS shipping point Because the shipment had notarived on December 31, 2022. It was add ton te physical overtory e On December 31, 2022, there were goods in varst to customerswe FOB srieping point amounting to $800 fpeclied delivery CA January 8, 2923). The roots senseped and ton to phyica avertory court (c) On December 31, 2022. David Corporation sliced $2.500 or oppos os customer FOB decination on January 52023. The goods were not on hand, and natinduded in the physical entory court I 1 David Corporation as the consigo had goods on consent that cost 35.000 These goods were on hand as of December 31, 2022 wd was included in the physical inventory court Instructions - 1) marts Anaryze the stone intematon and calculate the corned ending Inventory vauro yous work. Brety explain your rationalets how you cecio 15 hande och d to come (a) through