Inventory Shipped FOB Shipping Point and in Transit on the Last

question 19

Multiple Choice

Inventory shipped FOB shipping point and in transit on the last day of the year should be included in:

• A)the inventory balance of the seller.
• B)the inventory balance of the buyer.
• C)neither the inventory balance of the buyer or the seller.
• D)both the inventory balance of the buyer and the seller.

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Definitions:

Sales Transaction

The process of exchanging a good or service for payment between a buyer and a seller.

Implied Warranty

A legal assumption that a product will meet basic standards of quality and functionality, even if not expressly stated.

Merchantable

A quality of goods being fit for the purpose for which such goods are ordinarily used, a requirement for sales under many commercial laws.

Trade or Market

generally refers to a specific area or industry where goods and services are bought and sold.