Sterling Company reported their inventory as $50,700 on the books at December 31, 2021. At the close of the year, the auditors came in and identified the following issues: Product shipped to a customer December 28, 2021 f.o.b. destination costing $4,200, was not received by the customer until January 2022. The product was not included in the inventory balance because it was not in the warehouse.Samples costing $2,300 were delivered to a client for review on December 27, 2021. They are to be returned on January 5, 2022. They were not included in inventory because they were not in the warehouse.Purchases of product in the amount of $2,100 were in transit as of December 31, 2020. They had been shipped f.o.b. shipping point. They were not included in inventory because they were not in the warehouse.Product shipped to a customer December 28, 2020, f.o.b. shipping point cost $2,500. It was not received by the customer until January 2022. The product was not included in the inventory because it was not in the warehouse.

Name: Sterling Company reported their inventory as $50,700 on the books at D
Uploaded: 2024-03-20T06:32:37.000Z
Channel: Bartleby
Description: Sterling Company reported their inventory as $50,700 on the books at December 31, 2021. At the close of the year, the auditors came in and identified the following issues: Product shipped to a customer December 28, 2021 f.o.b. destination costing $4,

Correct amount of inventory is the value of the inventory which has been computed on the basis of…

Answered: Sterling Company reported their…

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter11: Auditing Inventory, Goods And Services, And Accounts Payable: The Acquisition And Payment Cycle

Section: Chapter Questions

Problem 26RQSC

See similar textbooks

Related questions

Concept explainers

Topic Video

Question

Sterling Company reported their inventory as $50,700 on the books at December 31, 2021. At the close of the year, the auditors came in and identified the following issues:

Product shipped to a customer December 28, 2021 f.o.b. destination costing $4,200, was not received by the customer until January 2022. The product was not included in the inventory balance because it was not in the warehouse.
Samples costing $2,300 were delivered to a client for review on December 27, 2021. They are to be returned on January 5, 2022. They were not included in inventory because they were not in the warehouse.
Purchases of product in the amount of $2,100 were in transit as of December 31, 2020. They had been shipped f.o.b. shipping point. They were not included in inventory because they were not in the warehouse.
Product shipped to a customer December 28, 2020, f.o.b. shipping point cost $2,500. It was not received by the customer until January 2022. The product was not included in the inventory because it was not in the warehouse.

Expert Solution

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.