Houghton Limited is trying to determine the value of its ending inventory as of February 28, 2022, the company's year-end. The following transactions occurred, and the accountant asked your help in determining whether they should be recorded or not. For each of the transactions below, specify whether the item in question should be included in ending inventory. and if so, at what amount On February 26, Houghton shipped goods costing $800 to a customer and charged the customer $1,000. The goods were shipped with terms FOB shipping point and the receiving report indicates that the customer received the goods on (a) 24 Not Included March 2. On February 26. Crain Inc. shipped goods to Houghton under terms FOB shipping point. The invoice price was S600 plus $40 for freight. The receiving report indicates that the goods were received by Houghton on March 2. (b) ncluded (c) the warehouse Houghton had $750 of inventory The inventory is designated for a customer who has requested that the goods be shipped on March 1O. blated Included Also included in Houghton's warehouse is $730 of inventory that Korenic Producers shipped to Houghton on consignment. (d) Not included On February 26, Houghton issued a purchase order to acquire goods costing $970. The goods were shipped with (e) Not included %24
Houghton Limited is trying to determine the value of its ending inventory as of February 28, 2022, the company's year-end. The following transactions occurred, and the accountant asked your help in determining whether they should be recorded or not. For each of the transactions below, specify whether the item in question should be included in ending inventory. and if so, at what amount On February 26, Houghton shipped goods costing $800 to a customer and charged the customer $1,000. The goods were shipped with terms FOB shipping point and the receiving report indicates that the customer received the goods on (a) 24 Not Included March 2. On February 26. Crain Inc. shipped goods to Houghton under terms FOB shipping point. The invoice price was S600 plus $40 for freight. The receiving report indicates that the goods were received by Houghton on March 2. (b) ncluded (c) the warehouse Houghton had $750 of inventory The inventory is designated for a customer who has requested that the goods be shipped on March 1O. blated Included Also included in Houghton's warehouse is $730 of inventory that Korenic Producers shipped to Houghton on consignment. (d) Not included On February 26, Houghton issued a purchase order to acquire goods costing $970. The goods were shipped with (e) Not included %24
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Houghton Limited is trying to determine the value of its ending inventory as of February 28. 2022, the company's year-end. The
following transactions occurred, and the accountant asked your help in determining whether they should be recorded or not.
For each of the transactions below, specify whether the item in question should be included in ending inventory, and if so, at what
amount.
On February 26, Houghton shipped goods costing $800 to a
customer and charged the customer $1,000. The goods were
shipped with terms FOB shipping point and the receiving
reportindicates that the customer received the goods on
(a)
Not Included
March 2
On February 26. Crain Inc shipped goods to Houghton under
terms FOB shipping point. The invoice price was S600 plus
$40 for freight. The receiving report indicates that the goods
were received by Houghton on March 2.
(b)
ncluded
Houghton had $750 of inventory isolated in the warehouse
The inventory is designated for a customer who has
requested that the goods be shipped on March 1O.
(c)
nduded
Also included in Houghton's warehouse is S730 of inventory
that Korenic Producers shipped to Houghton on
consignment.
(d)
Not included
On February 26, Houghton issued a purchase order to
acquire goods costing $970. The goods were shipped with
(e)
Not Included
terms FOR destination on Februarv 27. Houehton received
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