Purchased goods that have been shipped FOB destination but which are in transit at the end of the period should be excluded from the buyer's physical count of ending inventory.

Question

Quizplus · Accepted Answer

If the goods are still in transit, they have not yet arrived at the destination and so would not be included in the buyer's physical count of ending inventory. FOB destination means that the seller is responsible for the goods until they reach the buyer's location, so ownership and responsibility for the inventory would not transfer to the buyer until the goods are actually received.

Purchased Goods That Have Been Shipped FOB Destination but Which