Asked by Andrea Barisic on Jun 03, 2024
Verified
Goods held on consignment are included in the inventory valuation of
A) the consignor.
B) the consignee.
C) both the consignor and the consignee.
D) neither the consignor nor the consignee.
Consignment
The process of placing goods with a third party who has the authority to sell the goods on behalf of the owner, but the ownership of the goods remains with the consignor until sold.
Inventory Valuation
A method used to assess the cost or market value of inventories a company holds at the end of a period.
- Become familiar with the strategic dimensions of inventory management, including aspects of consignment and cycle counting.
Verified Answer
DM
Danny MeyersJun 10, 2024
Final Answer :
A
Explanation :
Goods held on consignment are not owned by the consignee until they are sold, so they should not be included in the consignee's inventory valuation. Instead, they should be included in the inventory valuation of the consignor, who still owns the goods until they are sold. Therefore, the correct choice is A – the consignor.
Learning Objectives
- Become familiar with the strategic dimensions of inventory management, including aspects of consignment and cycle counting.