616667

Module Week (Chapter 6) Exercise 6-1 Exercise 6-1 Item Goods held on consignment for Boxes Unlimited since December 22   Goods shipped on consignment to Rinehart Holdings Ltd on January   Include (Y/N) Do not include Explanation Shippers Ltd does not own items held on consignment Include in inventory Shippers Ltd still owns the items as they were only shipped on consignment Goods that are still in transit and were shipped to a customer FOB destination on January 29   Freight costs due on goods in transit from item above   Include in inventory Shipping terms FOB destination means that Shippers Ltd owns the items until they reach the customer Do not include Freight costs on goods shipped to customers are included in Freight Out or Delivery Expense Goods that are still in transit and were shipped to a customer FOB shipping point on January 29   Do not include The shipping terms are FOB shipping point so ownership has transferred to the customer Shippers Ltd should record this as a sale on the income statement Goods that are still in transit and were purchased FOB destination from a supplier on January 25 Do not include The shipping terms are FOB destination so Shippers Ltd does not own the goods until they arrive at Shippers Ltd.’s premises Goods that are still in transit and were purchased FOB shipping point from a supplier on January 25 Include in inventory Shipping terms FOB shipping point means that ownership transferred at the time of shipping and therefore, Shippers Ltd owns the goods in transit Exercise 6-6 Exercise 6-6 Exercise 6-6 Exercise 6-6 Exercise 6-7 Exercise 6-7 Exercise 6-7 10 Questions?? 11