Goods in transit are included in inventory:

Question

Quizplus · Accepted Answer

Goods in transit should be included in inventory when the purchaser is responsible for paying the freight charges and when ownership has passed to the purchaser. This is because the risks and benefits of ownership have been transferred to the purchaser, and they have control over the goods. Including goods in transit that the supplier is responsible for paying the freight charges for could potentially overstate the purchaser's inventory, as they do not have control over the goods until ownership is transferred. Goods in transit at any time would be too broad of a statement and would not accurately reflect the transfer of ownership and control.

Goods in Transit Are Included in Inventory