DQuestion 15 Warner Corporation completes a physical count of inventory on Decem

Question

DQuestion 15 Warner Corporation completes a physical count of inventory on December 31, 2016, its year-end. and determines they have 1200 units of inventory on hand. Included in the 1200 units units on hand are 200 units of inventory Warner Corporation is holding for Straight Company on consignment. In addition to the units on hand, Warner Corporation sold 550 additional units to customers that are in transit at year-end: 250 units in transit were shipped to customers FOB shipping point and the remainder were shipped FOB destination. How many units of inventory should Warner Corporation report on December 31, 2016? 1500 1250 1300 1700 1450

Explanation / Answer

Answer is 1300 units.

Explanation:

Inventory in hand on Dec 31, 2016: 1200 units Less: Inventory held as consignee -200 units Add: Inventory shipped under FOB destination terms not received by customer 300 units Inventory to be reported on Dec 31, 2016 1300 units

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