11. Goods in transit are included in a purchaser\'s inventory A. At any time dur
ID: 2517184 • Letter: 1
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11. Goods in transit are included in a purchaser's inventory A. At any time during transit B. When the purchaser is responsible for paying freight charges. C. When the supplier is responsible for freight charges. D. If the goods are shipped FOB destination E. After the half-way point between the buyer and seller 12. Goods on consignment A. Are goods shipped by the owner to the consignee who sells the goods for the owner B. Are reported in the consignee's books as inventory C. Are goods shipped to the consignor who sells the goods for the owner Are not reported in the consignor's inventory since they do not have possession of the inventory E Are always paid for by the consignee when they take possession. 13. During a period of steadily rising costs,the inventory valuation method that yields the lowest reported net income is: A. Specitic identification method. B. Average cost method C Weighted-average method. D. FIFO method. E. LIFO method. 14. The consistency concept: A. Preseribes a company to consistently apply the same accounting method of inventory valuation, an exception being when a change from one method to another will improve its financial reporting. B. Requires a company to use one method of inventory v C. Requires that all companies in the same industry use the same accounting methods of inventory valuation. D. Is also called the full disclosure principle. E. Is also called the matching principle.Explanation / Answer
11) option b) when the purchaser is responsible for paying freight charges (this is because the goods are shipped FOB shipping point the title to the goods transfers to purchases once the goods are on board hence should be included in purchasers inventory) 12) option A are goods shipped by the owner to the consignee who sells the goods for the owner 13) option E) LIFO method since the goods are valued at the latest price hence cost of goods sold will be higher under this method 14) option A prescribes a company to consistenlty apply the same accounting method of inventory valuation , an exception being when a change from one method to another will improve its financial reporting
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