Thanks in advance DQuestion 10 20 pts (TCO G) In your audit of Garza Company, yo

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Thanks in advance

DQuestion 10 20 pts (TCO G) In your audit of Garza Company, you find that a physical inventory on December 31, 2010, showed merchandise with a cost $471,000 was on hand at that date You also discover the following items were all excluded from the inventory count -Merchandise of $61 000, which was shipped by Garza as to b shipping point The buyer is the Bontermps Company Merchandise costing $33,000, which was on consignment. The consignee is the Proctor Company Merchandise costing $95,000, which was shipped by Garza fob destination to a customer on December 29, 2010. The customer was scheduled to receive the merchandise on January 2, 2011 Merchandise costing $103,000 shipped by a vendor fob destination on December 30, 2010, and received by Garza on January 4, 2011 Merchandise costing $85,000 shipped by a vendor fo b shipping point on December 31, 2010, and received by Garza on January 5, 2011 Based on the above information, calcuiate the amount that should appear on Garza's balance sheet at December 31, 2010 for inventory HTML Editor Paragraph

Explanation / Answer

Note: The consignor is the owner of the goods sent on consignment till the time they are sold.

FOB shipping point means the sale takes place at the seller's port.

FOB destination means the sale takes place when the goods are received at the buyer's port.  

Merchandise per physical inventory 471000 Add: Merchandise on consignment with Proctor Company 33000 Merchandise shipped FOB destination on Dec. 29, 2010 to be received by customer on Jan. 2, 2011 95000 Merchandise shipped by vendor FOB shipping point 85000 Inventory on Garza's December 31, 2010 balance sheet $ 684000

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