Question
ABC Inc. is trying to determine the value of ending inventory as of September 30, 2019. Considering the transactions given below, help ABC in determining
ABC Inc. is trying to determine the value of ending inventory as of September 30, 2019. Considering the transactions given below, help ABC in determining whether these should be recorded in inventory or not. Also justify your answer. (a) On September 25, XYZ Inc. shipped goods costing $500 to ABC with terms FOB destination. ABC received the goods on October 3. (b) On September 28, ABC shipped goods costing $1,250 to a customer with terms FOB destination. Customer received the goods on October 5. (c) On September 28, ABC purchased goods costing $2,000 with terms FOB shipping point. Goods were shipped to ABC on September 28. ABC received the goods on October 1. (d) ABC has goods of $1,600 in stock under the arrangements of consignment. (e) On September 29, ABC shipped goods to PLO Inc. under terms FOB shipping point. The cost of the items was $3,000. PLO received the goods on October 4.
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