Goods in transit: Goods in transit can be described as the inventories which are shipped by the seller by using different mode of transportation but are yet to reach the buyer. The ownership of goods in transit depends on the legal title to the goods which further depends on the terms of the sale. To indicate: The terms of sale that will result in the goods being included.

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Chapter 6, Problem 5Q

(a)

To determine

Goods in transit: Goods in transit can be described as the inventories which are shipped by the seller by using different mode of transportation but are yet to reach the buyer. The ownership of goods in transit depends on the legal title to the goods which further depends on the terms of the sale.

To indicate: The terms of sale that will result in the goods being included.

(b)

To determine

To explain: The circumstances under which Company M include consigned goods in its inventory.

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