Goods in transit should be included in the inventory of the A) seller when the terms are FOB shipping point

Marketing Dec 22, 2020

Goods in transit should be included in the inventory of the

A) seller when the terms are FOB shipping point.

B) buyer when the terms are FOB destination.

C) buyer when the terms are FOB shipping point.

D) transportation company when the terms are FOB destination.

Expert Solution

Answer: C) buyer when the terms are FOB shipping point.

Goods in transit should be included in the inventory of the buyer when the terms are FOB shipping point. Inventories are recorded in the books of the company who has the possession or risks on the items. Under the terms FOB shipping point, the buyer is responsible for the payment of transportation fees and the risks are transferred to the buyer upon shipment, which is why it should already be included as inventory of the buyer.

Archived Solution

Unlocked Solution

You have full access to this solution. To save a copy with all formatting and attachments, use the button below.

Already a member? Sign In

Important Note: This solution is from our archive and has been purchased by others. Submitting it as-is may trigger plagiarism detection. Use it for reference only.

For ready-to-submit work, please order a fresh solution below.

Or get 100% fresh solution

Get Custom Quote