Which of the following items should be included in the client’s physical invento

Question

Which of the following items should be included in the client’s physical inventory at year-end?

a. Merchandise purchased by the client (fob destination – terms) that was shipped by the supplier on December 28th and received by the client on January 2nd.

b. Merchandise sent to a customer by the client (fob shipping point – terms) that was shipped by the client on December 28th and received by the client on January 2nd.

c. Inventory received by the client in December, from a consignor and that has not as of yet been sold.

d. None of the above should be included in the clients inventory.

Explanation / Answer

option c) is the answer

. Inventory received by the client in December, from a consignor and that has not as of yet been sold.

Reason:Consigned inventory belongs to consignor ,not the consignee .The inventory if unsold at year end is part of the consignors ending inventory

option c) is the answer

. Inventory received by the client in December, from a consignor and that has not as of yet been sold.

Reason:Consigned inventory belongs to consignor ,not the consignee .The inventory if unsold at year end is part of the consignors ending inventory

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