Goods in transit are included in a purchaser's inventory:Multiple ChoiceAt any time during transit.When the goods are shipped FOB shipping point.When the supplier is responsible for freight charges.If the goods are shipped FOB destination.After the half-way point between the buyer and seller.

The sales invoice includes the shipping costs and details as FOB shipping, FOB destination.

Goods in transit are included in a purchaser's inventory: Multiple Choice O At any time during transit. When the goods are shipped FOB shipping point. O When the supplier is responsible for freight charges. O If the goods are shipped FOB destination. O After the half-way point between the buyer and seller.

Goods in transit are included in a purchaser's inventory: Multiple Choice O At any time during transit. When the goods are shipped FOB shipping point. O When the supplier is responsible for freight charges. O If the goods are shipped FOB destination. O After the half-way point between the buyer and seller.

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter5: Accounting For Retail Businesses

Section: Chapter Questions

Problem 38E: Rules of debit and credit for periodic inventory accounts Complete the following table by indicating...

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Merchandise Accounting Merchandise Inventory Raw materials Work in process Finished goods Gross profit Net sales Sales revenue Cost of goods available for sale Cost of goods sold Perpetual system Periodic system Transportation-In Purchases FOB destination point FOB shipping point Gross profit ratio An adjunct account used to record freight costs paid by the buyer. A system in which the Inventory account is increased at the time of each purchase and decreased at the time of each sale. Terms that require the seller to pay for the cost of shipping the merchandise to the buyer. Terms that require the buyer to pay for the shipping costs. A system in which the Inventory account is updated only at the end of the period. Beginning inventory plus cost of goods purchased. An account used in a periodic inventory system to record acquisitions of merchandise. Sales revenue less sales returns and allowances and sales discounts. Cost of goods available for sale minus ending inventory. Gross profit divided by net sales. Net sales less cost of goods sold. The cost of unfinished products in a manufacturing company. The account wholesalers and retailers use to report inventory held for sale. The inventory of a manufacturer before the addition of any direct labor or manufacturing overhead. A manufacturers inventory that is complete and ready for sale. A representation of the inflow of assets from the sale of a product.
For goods in transit at the end of a period, describe how a company determines if the goods should be included in inventory.
Under the periodic inventory system, the ending inventory is entered by debiting Merchandise Inventory and crediting Income Summary.
Under the retail inventory method, freight-in would be included in the calculation of the goods available for sale for which of the following?
Which of the following accounts are used when recording a purchase using a periodic inventory system? A. cash, purchases B. accounts payable, sales C. accounts payable, accounts receivable D. cash, merchandise inventory
Under the perpetual inventory system, how does the seller record sales made on account?
Perpetual and Periodic Inventory Systems Below is a list of inventory systems options. a. Perpetual inventory system b. Periodic inventory system c. Both perpetual and periodic inventory systems Required: Match each option with one of the following: 1. Only revenue is recorded as sales are made during the period; the cost of goods sold is recorded at the end of the period. 2. Cost of goods sold is determined as each sale is made. 3. Inventory purchases are recorded in an inventory account. 4. Inventory purchases are recorded in a purchases account. 5. Cost of goods sold is determined only at the end of the period by subtracting the cost of ending inventory from the cost of goods available for sale. 6. Both revenue and cost of goods sold are recorded during the period as sales are made. 7. The inventory is verified by a physical count.
A sale is recorded when goods leave the seller's shipping department when the merchandise is shipped: Multiple Choice Goods in transit, shipped collect. FOB destination. FOB shipping point. Freight-out, seller shipped. 1
When the buyer pays the freight costs, the entry to record the payment under a perpetual inventory system would include a debit to _______. Question content area bottom Part 1 A. Freight In B. Inventory C. Purchases Discounts D. Delivery Expense
If the buyer is to pay the freight costs of delivering merchandise, delivery terms are stated as Da. FOB destination Ob. FOB shipping point Oc. FOB n/30 Od. FOB buyer
If title to merchandise purchases passes to the buyer when the goods are delivered to the buyer, the terms are a. consigned b. n/30 c. FOB shipping point d. FOB destination
If the sale includes the seller paying the freight costs and assuming the responsibility for merchandise until it is received by the buyer, the freight terms are said to be: A FOB shipping point. В FOB destination. (c) sales discount. D) trade discount.