Which goods in transit would be recorded in inventory at year end?
A)Goods purchased with terms F.O.B. destination point that were received after year end.
B)Goods sold with terms F.O.B. shipping point that were shipped before year end.
C)Goods purchased with terms F.O.B. shipping point that were received after year end.
D)Goods sold with terms F.O.B. destination point that were shipped before year end.

Question

Quizplus · Accepted Answer

Goods purchased with terms F.O.B. shipping point that were received after year end would be recorded in inventory at year end. The title (ownership) of these goods was likely transferred to the buyer during transit, so they would not be included in inventory at year end if they were purchased with terms F.O.B. destination point. Goods sold with terms F.O.B. shipping point that were shipped before year end would be included in inventory at year end under the buyer's ownership, but goods sold with terms F.O.B. destination point that were shipped before year end would not be included in inventory at year end under the seller's ownership.

Which Goods in Transit Would Be Recorded in Inventory at Year