Tools Add ons Help All changes saved in Drive text. Arial 11. BI VA L I E E * 11. Inventories affect a only the balance sheet. b. Only the income statement. c. both the balance sheet and the income statement. d. neither the balance sheet nor the income statement. 12. The factor which determines whether or not goods should be included in a physical count of inventory is a. physical possession b. legal title C management's judgment. d whether or not the purchase price has been paid. 13. An auto manufacturer would classify vehicles in various stages of production as a finished goods. b. merchandise inventory. C. raw materials. d. work in process. 14. Freight terms of FOB shipping point mean that the a. seller must debit freight out. b. buyer must bear the freight costs. C. goods are placed free on board at the buyer's place of business. d. seller must bear the freight costs. 15. Fetherston Company's (seller & buyer) goods in transit at December 31 include: sales made purchases made (1) FOB destination (3) FOB destination (2) FOB shipping point (4) FOB shipping point Which items should be included in Fetherston's inventory at December 31? a. (2) and (3) b. (1) and (4) C. (1) and (3)