The company counted its ending inventory on December 31. None of the following items were included when
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$15,000 in goods located in the company’s warehouse that are on consignment from another company.
$20,000 in goods that were sold by the company and shipped on December 30 and were in transit on December 31; the goods were received by the customer on January 2. Terms were FOB destination.
$30,000 in goods that were purchased by the company and shipped on December 30 and were in transit on December 31; the goods were received by the company on January 2. Terms were FOB shipping point.
$40,000 in goods that were sold by the company and shipped on December 30 and were in transit on December 31; the goods were received by the customer on January 2. Terms were FOB shipping point.
The company’s reported inventory (before any corrections) was $200,000. What is the correct amount of the company’s inventory on December 31?
Ending Inventory
The ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...
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Before adjustment 200000 Consignment no adjust...View the full answer
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Related Book For 
Intermediate Accounting
ISBN: 978-0324592375
17th Edition
Authors: James D. Stice, Earl K. Stice, Fred Skousen
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