Given the Following Items and Costs as of the Balance

question 34

Multiple Choice

Given the following items and costs as of the balance sheet date,determine the value of Light Company's merchandise inventory.
$2,000 goods sold by Light to another company.The goods are in transit and shipping terms are FOB shipping point.
$3,000 goods sold by another company to Light.The goods are in transit and shipping terms are FOB shipping point.
$4,000 owned by Light but in the possession of another company the consignee.
Damaged goods owned by Light which originally cost $5,000,but which now have an $800 net realizable value.

• A)$7,000
• B)$7,800
• C)$9,800
• D)$9,000
• E)$6,800

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Definitions:

Terms

Conditions and stipulations that define an agreement or contract.

Discounts

Reductions applied to the selling price of goods or services for promotions, bulk purchases, or other reasons.

Sold

Refers to the act of exchanging a product or service for money or other compensation; a completed transaction.

Discount

A reduction from the usual cost of something, usually provided as an incentive to increase sales.