1. EMO Company had the following inventory items at 12/31/xx Inventory items purchased from another company that...

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Accounting

1. EMO Company had the following inventory items at12/31/xx
Inventory items purchased from another company that cost $3,300 andwere in transit on December 31 with shipping terms of FOB ShippingPoint.
Inventory items purchased from another company that cost $2,800 andwere in transit on December 31 with shipping terms of FOBDestination.
Inventory items sold to another company that had cost $3,500 andwere in transit on December 31 with shipping terms FOB ShippingPoint.
Inventory items sold to another company that had cost $3,000 andwere in transit on December 31 with shipping terms FOBDestination.
How much of the above items should be included in the company'sinventory on the December 31 Balance Sheet?
2. Tagit Inc. had the following inventory items on12/31/xx
Goods for sale in the store of another retailer on consignment fromTagit Inc. that had a cost of $3,300.
Goods in the store of Tagit Inc. placed on consignment from anothercompany with a cost of $2,600.
Goods owned by Tagit Inc. that cost $3,300 have been damaged bywater. The goods can be sold for $3,800 if $2,900 is spent cleaningand repairing them.
How much of the above items should be included in the company'sinventory on the December 31 Balance Sheet?

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4.0 Ratings (663 Votes)

1 The terms FOB destination and FOB shipping point indicate a specific location at which title to the ownership of goods is transferredIf goods are shipped FOB shipping point these goods are part of the buyers inventory while in transit If goods are shipped FOB destination these goods are part of See Answer

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