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 (b) OF) On February 26, Houghton shipped goods costing $700 to a customer and charged the customer $875. The goods were shipped with terms FOB shipping point and the receiving report indicates that the customer received the goods on March 2 On February 26, Crain Inc. shipped goods to Houghton under terms FOB shipping point. The invoice price was $450 plus $50 for freight. The receiving report indicates that the goods were received by Houghton on March 2 Houghton had $800 of inventory isolated in the warehouse. The inventory is designated for a customer who has requested that the goods be shipped on March 10. Also included in Houghton's warehouse is $780 of inventory that Korenic Producers shipped to Houghton on consignment On February 26, Houghton issued a purchase order to acquire goods costing $960. The goods were shipped with terms FOB destination on February 27. Houghton received the goods on March 2 On February 26, Houghton shipped goods to a customer under terms FOB destination. The invoice price was $410; the cost of the items was $250. The receiving report indicates that the goods were received by the customer on March 2 Houghton had damaged goods set aside in the warehouse because they are no longer saleable. These goods originally cost $400, and Houghton had expected to sell these items for Not Included Included Included Not Included Not Indiudad Included Not Included S S S S | | | | | | 500 780 960
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 (b) OF) On February 26, Houghton shipped goods costing $700 to a customer and charged the customer $875. The goods were shipped with terms FOB shipping point and the receiving report indicates that the customer received the goods on March 2 On February 26, Crain Inc. shipped goods to Houghton under terms FOB shipping point. The invoice price was $450 plus $50 for freight. The receiving report indicates that the goods were received by Houghton on March 2 Houghton had $800 of inventory isolated in the warehouse. The inventory is designated for a customer who has requested that the goods be shipped on March 10. Also included in Houghton's warehouse is $780 of inventory that Korenic Producers shipped to Houghton on consignment On February 26, Houghton issued a purchase order to acquire goods costing $960. The goods were shipped with terms FOB destination on February 27. Houghton received the goods on March 2 On February 26, Houghton shipped goods to a customer under terms FOB destination. The invoice price was $410; the cost of the items was $250. The receiving report indicates that the goods were received by the customer on March 2 Houghton had damaged goods set aside in the warehouse because they are no longer saleable. These goods originally cost $400, and Houghton had expected to sell these items for Not Included Included Included Not Included Not Indiudad Included Not Included S S S S | | | | | | 500 780 960
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:- Your answer is partially correct.
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.
(c)
(d)
(e)
On February 26, Houghton shipped goods costing $700 to a
customer and charged the customer $875. The goods were
shipped with terms FOB shipping point and the receiving
report indicates that the customer received the goods on
March 2.
On February 26, Crain Inc. shipped goods to Houghton under
terms FOB shipping point. The invoice price was $450 plus
$50 for freight. The receiving report indicates that the goods
were received by Houghton on March 2.
Houghton had $800 of inventory isolated in the warehouse.
The inventory is designated for a customer who has
requested that the goods be shipped on March 10.
Also included in Houghton's warehouse is $780 of inventory
that Korenic Producers shipped to Houghton on consignment.
On February 26, Houghton issued a purchase order to acquire
goods costing $960. The goods were shipped with terms FOB
destination on February 27. Houghton received the goods on
March 2.
On February 26, Houghton shipped goods to a customer
under terms FOB destination. The invoice price was $410; the
cost of the items was $250. The receiving report indicates
that the goods were received by the customer on March 2
Houghton had damaged goods set aside in the warehouse
because they are no longer saleable. These goods originally
cost $400, and Houghton had expected to sell these items for
$600.
Not Included
Included
Included
Not Included
Not Included
Included
Not Included
$
S
$
$
700
| | | | |
900
780
960
250
400
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