Explanation Given info, The cost of goods on hand on basis of physical count is $297,000. The cost of goods sold to L Company on terms of FOB shipping point, on December 28 is $38,000 (not included in physical count). The goods purchased of $95,000 on terms of FOB destination are in transit at year end (not included in physical count). The goods of $22,000 are in transit, which were purchased on terms of FOB shipping point (not included in physical count). The cost of goods sold to J Company on terms of FOB destination is $35,000, these goods were received by J Company on January 8 (not included in physical count). The goods purchased of $44,000 on terms of FOB destination are received on January 2 (included in ending inventory). Calculate the correct amount of ending inventory as follow: Particulars Amount ($) ...

12th Edition

ISBN: 9781118875056

Author: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso

Publisher: WILEY

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Chapter 6, Problem 6.1E

To determine

Inventory: It refers to the total stock of such goods or items which are held by the business organizations with the purpose of sale.

Free on board (FOB): It refers to the term of sales, which states who will be liable for the risk related to the damage of goods in transit. This liability can be of seller or buyer, depends upon the condition.

The types of free board are:

Free on board (FOB) shipping point

Free on board (FOB) destination

FOB shipping point: In free on board (FOB) shipping point, ownership of goods transferred from seller to buyer with the transfer of goods to the goods carrier.

FOB destination: In free on board (FOB) destination, the ownership and risk related to goods to be sold will remain with the seller till the date on which consignment will be actually received by the buyer.

To determine: The correct amount of inventory of W Company on December 31.

Expert Solution & Answer

Chapter 6 Solutions

Accounting Principles - Standalone book

Ch. 6 - Prob. 1Q Ch. 6 - Prob. 2Q Ch. 6 - Prob. 3Q Ch. 6 - Prob. 4Q Ch. 6 - Prob. 5Q Ch. 6 - 6. Explain the difference between the terms FOB...Ch. 6 - Prob. 7Q Ch. 6 - Prob. 8Q Ch. 6 - 9. “The selection of an inventory cost flow method...Ch. 6 - Prob. 10Q

Ch. 6 - 11. In a period of rising prices, the inventory...Ch. 6 - Prob. 12Q Ch. 6 - 13. Kyle Adams is studying for the next accounting...Ch. 6 - Prob. 14Q Ch. 6 - Prob. 15Q Ch. 6 - Prob. 16Q Ch. 6 - Prob. 17Q Ch. 6 - Prob. 18Q Ch. 6 - Prob. 19Q Ch. 6 - Prob. 20Q Ch. 6 - Prob. 21Q Ch. 6 - Prob. 22Q Ch. 6 - Prob. 23Q Ch. 6 - Prob. 24Q Ch. 6 - Prob. 25Q Ch. 6 - Prob. 6.1BE Ch. 6 - Prob. 6.2BE Ch. 6 - Prob. 6.3BE Ch. 6 - Prob. 6.4BE Ch. 6 - Prob. 6.5BE Ch. 6 - Prob. 6.6BE Ch. 6 - Prob. 6.7BE Ch. 6 - Prob. 6.8BE Ch. 6 - Prob. 6.9BE Ch. 6 - Prob. 6.10BE Ch. 6 - Prob. 6.11BE Ch. 6 - Prob. 6.1DIE Ch. 6 - Prob. 6.2DIE Ch. 6 - Prob. 6.3DIE Ch. 6 - Prob. 6.4DIE Ch. 6 - Prob. 6.1E Ch. 6 - Prob. 6.2E Ch. 6 - E6-3 On December 1, Kiyak Electronics Ltd. has...Ch. 6 - Prob. 6.4E Ch. 6 - Prob. 6.5E Ch. 6 - Prob. 6.6E Ch. 6 - Prob. 6.7E Ch. 6 - Prob. 6.8E Ch. 6 - Prob. 6.9E Ch. 6 - Prob. 6.10E Ch. 6 - Prob. 6.11E Ch. 6 - Prob. 6.12E Ch. 6 - Prob. 6.13E Ch. 6 - Prob. 6.14E Ch. 6 - E6-15 Ehrhart Appliance uses a perpetual inventory...Ch. 6 - Prob. 6.16E Ch. 6 - Prob. 6.17E Ch. 6 - Prob. 6.18E Ch. 6 - Prob. 6.19E Ch. 6 - Prob. 6.20E Ch. 6 - Prob. 6.1AP Ch. 6 - Prob. 6.2AP Ch. 6 - Prob. 6.3AP Ch. 6 - Prob. 6.4AP Ch. 6 - Prob. 6.5AP Ch. 6 - Prob. 6.6AP Ch. 6 - P6-7A The management of Danica Co. asks your help...Ch. 6 - Prob. 6.8AP Ch. 6 - Prob. 6.9AP Ch. 6 - P6-10A Bao Company lost all of its inventory in a...Ch. 6 - Prob. 6.11AP Ch. 6 - CP6 On December 1, 2017, Annalise Company had the...Ch. 6 - Prob. 6.1BYP Ch. 6 - Prob. 6.2BYP Ch. 6 - Prob. 6.3BYP Ch. 6 - Prob. 6.5BYP Ch. 6 - Prob. 6.6BYP Ch. 6 - Prob. 6.7BYP Ch. 6 - Prob. 6.8BYP Ch. 6 - Prob. 6.1IFRS Ch. 6 - Prob. 6.2IFRS

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