Asked by Alondra Aguirre on May 14, 2024
Verified
Inventory shipped on consignment is owned by the consignee.
Inventory Shipped on Consignment
Goods sent by a vendor (consignor) to a consignee, which are held by the consignee until sold; the consignor retains ownership until the goods are sold.
Consignee
The individual or entity that is legally permitted to receive goods but does not have ownership rights over the cargo until the consignment is paid for or sold.
- Identify the legal and accounting treatment of inventory ownership and consignment.
Verified Answer
MO
Mikayla OkawaMay 20, 2024
Final Answer :
False
Explanation :
Inventory shipped on consignment is owned by the consignor, not the consignee. The consignee simply holds the goods and sells them on behalf of the consignor. Ownership only transfers once the goods have been sold and the consignee has paid for them.
Learning Objectives
- Identify the legal and accounting treatment of inventory ownership and consignment.