E6.3 (LO 1), AN Gato Inc. had the following inventory situations to consider at January 31, its year-end. a. Goods held on consignment for Steele Corp. since December 12. b. Goods shipped on consignment to Logan Holdings Inc. on January 5. c. Goods shipped to a customer, FOB destination, on January 29 that are still in transit. d. Goods shipped to a customer, FOB shipping point, on January 29 that are still in transit. e. Goods purchased FOB destination from a supplier on January 25 that are still in transit. f. Goods purchased FOB shipping point from a supplier on January 25 that are still in transit. g. Office supplies on hand at January 31. Instructions Identify which of the preceding items should be included in inventory. If the item should not be included Identify items in inventory.

E6.3 (LO 1), AN Gato Inc. had the following inventory situations to consider at January 31, its year-end. a. Goods held on consignment for Steele Corp. since December 12. b. Goods shipped on consignment to Logan Holdings Inc. on January 5. c. Goods shipped to a customer, FOB destination, on January 29 that are still in transit. d. Goods shipped to a customer, FOB shipping point, on January 29 that are still in transit. e. Goods purchased FOB destination from a supplier on January 25 that are still in transit. f. Goods purchased FOB shipping point from a supplier on January 25 that are still in transit. g. Office supplies on hand at January 31. Instructions Identify which of the preceding items should be included in inventory. If the item should not be included Identify items in inventory.

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Description: E6.3 (LO 1), AN Gato Inc. had the following inventory situations to consider at January 31, its year-end.a. Goods held on consignment for Steele Corp. since December 12.b. Goods shipped on consignment to Logan Holdings Inc. on January 5.c. Goods shi

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.

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Question

E6.3 (LO 1), AN Gato Inc. had the following inventory situations to consider at January 31, its year-end.
a. Goods held on consignment for Steele Corp. since December 12.
b. Goods shipped on consignment to Logan Holdings Inc. on January 5.
c. Goods shipped to a customer, FOB destination, on January 29 that are still in transit.
d. Goods shipped to a customer, FOB shipping point, on January 29 that are still in transit.
e. Goods purchased FOB destination from a supplier on January 25 that are still in transit.
f. Goods purchased FOB shipping point from a supplier on January 25 that are still in transit.
g. Office supplies on hand at January 31.
Instructions
Identify which of the preceding items should be included in inventory. If the item should not be included
in inventory, state in what account, if any, it should have been recorded.
Identify items in inventory.

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