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ABC Company sold and shipped merchandise to XYZ Company on December 28, 2019, with shipping terms of FOB shipping point. ABC notified XYZ of the

ABC Company sold and shipped merchandise to XYZ Company on December 28, 2019, with shipping terms of FOB shipping point. ABC notified XYZ of the shipment on December 28, 2019. XYZ received the merchandise on January 3, 2020. Which one of the following statements is true?

a. XYZ Company should record a liability for the purchase on January 3, 2018

b. ABC Company should record sales revenue on December 28, 2017

c. XYZ Company must pay the transportation costs in cash

d. ABC Company should include the merchandise in its inventory at December 31, 2017

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