Asked by Rosario Martinez on Jul 22, 2024
Verified
Goods out on consignment should be included in the inventory of the consignor.
Consignment
A sales arrangement in which goods are entrusted to a seller, but title to the goods remains with the supplier until they are sold.
Consignor
The entity that owns goods but entrusts them to another (consignee) for sale, distribution, or safekeeping.
Inventory
The raw materials, work-in-progress products, and finished goods that are considered to be the portion of a business’s assets that are ready or will be ready for sale.
- Acquire knowledge on how inventory is classified and valued in the balance sheet.
- Know the proper accounting for goods out on consignment and goods in transit.
Verified Answer
SK
Suraya KamasJul 24, 2024
Final Answer :
True
Explanation :
Goods out on consignment remain the property of the consignor until they are sold by the consignee, hence they should be included in the inventory of the consignor.
Learning Objectives
- Acquire knowledge on how inventory is classified and valued in the balance sheet.
- Know the proper accounting for goods out on consignment and goods in transit.