Respuesta :
Answer:
The amount of inventory reported on balance sheet is $62,500
Explanation:
In this question, we are asked to calculate the value at which inventory will be reported on the balance sheet.
To do this, we can employ a mathematical approach.
Mathematically;
Amount of inventory reported in Balance sheet = physical inventory + goods sent on consigned + inventory purchased on fob destination
From the question, we can identify the following;
Physical inventory = $50,000
Goods sent on consigned = $10,000
Inventory purchased on fob destination = $2,500
The amount of inventory reported in balance sheet = 50,000 + 10,000 + 2,500 = $62,500
Answer:
The answer is $67,500
Explanation:
The term free on board(FOB) implies that the goods remain the asset of the seller until the goods arrive at the buyer's receiving point,hence the inventory in transit purchased FOB destination of $2,500,does not belong to MegaCorp unitl it reaches MegaCorp's destination.
Consigined goods are goods in business's possession but not owned by the firm because it has been mandated by the owner to hold and sell them.As a result,the consigned goods with Madison company still belong to MegaCorp an should be added to its inventory.
Finally, the goods sold FOB($7,500) are goods belonging to MegaCorp until the buyer receives them,in other words it is part of the closing inventory:
Physical inventory count $50,000
Consigned goods $10,000
Inventory sold FOB $7,500
closing inventory $67,500
