1.The December 31, 2013, year-end inventory balance of the Raymond Corporation is $210,000. You have been asked to review the following transactions to determine if they have been correctly recorded.

2.Goods shipped to Raymond f.o.b. destination on December 26, 2013, were received on January 2, 2014. The invoice cost of $30,000 is included in the preliminary inventory balance.

3.At year-end, Raymond held $14,000 of merchandise on consignment from the Harrison Company. This merchandise is included in the preliminary inventory balance.

4.On December 29, merchandise costing $6,000 was shipped to a customer f.o.b. shipping point and arrived at the customer’s location on January 3, 2014. The merchandise is not included in the preliminary inventory balance.

5.At year-end, Raymond had merchandise costing $15,000 on consignment with the Joclyn Corporation. The merchandise is not included in the preliminary inventory balance.

Required:

Determine the correct inventory amount to be reported in Raymond’s 2013 balance sheet.

Please help! Thank you

Happy to help, but so far you've just posted the homework question itself. It's still your move.

Happy to help, but so far you've just posted the homework question itself. It's still your move.

Well, I tried about every number but still wrong. This is one of them I tried:

210,000
(14,000) should not be included in his inventory right? Cause It's consignment.
(6000) should be deducted from his inventory since it's fob shipping point
=190,000? Ending inv.

Your first adjustment---and your rationale---is correct.

Your thinking (re fob shipping point) is correct on that second adjustment of yours, but you need to re-read the facts of item (4) very carefully.

Now give your thinking regarding items (2) and (5).

Your first adjustment---and your rationale---is correct.

Your thinking (re fob shipping point) is correct on that second adjustment of yours, but you need to re-read the facts of item (4) very carefully.

Now give your thinking regarding items (2) and (5).



Oh! Ok.. can you be my tutor.. I like it when you ask like that. That's how I understand better ☺

#2. No adjustment right.. because its fob destination to him. He didn't get it yet.
#5 No adjustment too because he didn't include it in his inventory because it's consignment. Inventory is not his, it's still owned by consignor.

Thank you big time!

Your first adjustment---and your rationale---is correct.

Your thinking (re fob shipping point) is correct on that second adjustment of yours, but you need to re-read the facts of item (4) very carefully.

Now give your thinking regarding items (2) and (5).



Oh, the #4, well it's fob point. He has to deduct that from his inventory as soon as it shipped. It says it's not included in his preliminary inventory. He should include it by deducting it right?

Waaaa I never been confuse!

Nope, you're not confused, your reasoning about the adjustments is on track for the most part. You just need to organize your thoughts.

Put it all together into one post. You know the ending inventory is currently recorded as 210,000. There are four items which may or may not require adjustments.

In one post, take each of those items in turn, (2), (3), (4), and (5). For each one,
• Tell me if the item should or should not be included in Raymond's ending inventory, and say why.
• Tell me if it is, or is not, already included in Raymond's ending amount of 210,000.
• Make the adjustment, if either it is in the ending number and shouldn't be, or if it isn't there but should be.

Finally, arrive at the final adjusted ending inventory number. Do all this in one post and let's see what you've got. It might help to organize it first onto a piece of paper, then post it when you're satisfied with it.

Ok Captain!

#2. It should BE included in his inventory because it's fob destination. He cannot take as a sale until the buyer take possession of the product. Since he include this in his inv. Balance, no adjustment necessary.

#3. It should NOT be included because it's consignment. It is owned by the consignor. He include this in his inventory but it should NOT be. So we have to it deduct it 210-14=196

#4. Fob shipping point meaning he can record the sale as soon as the products is in transit even though the buyer is not in possession of the product yet. It should NOT be included in his inventory and he didn't so NO adjustments necessary.

#5. It's consignment. It should not be included in his inventory. It belongs to consignor's inventory. He didn't include it so No adjustment necessary.

So the ending inventory should be $196,000 But my teacher said it's wrong. And he does not tell me why. That's sad ha?












Nope, you're not confused, your reasoning about the adjustments is on track for the most part. You just need to organize your thoughts.

Put it all together into one post. You know the ending inventory is currently recorded as 210,000. There are four items which may or may not require adjustments.

In one post, take each of those items in turn, (2), (3), (4), and (5). For each one,
• Tell me if the item should or should not be included in Raymond's ending inventory, and say why.
• Tell me if it is, or is not, already included in Raymond's ending amount of 210,000.
• Make the adjustment, if either it is in the ending number and shouldn't be, or if it isn't there but should be.

Finally, arrive at the final adjusted ending inventory number. Do all this in one post and let's see what you've got. It might help to organize it first onto a piece of paper, then post it when you're satisfied with it.

Good: with your draft solution put together like that, it makes it much easier to analyze where there might remain any issues to de-bug. Now,

Re-read #2 carefully to determine who is the buyer of this merchandise.

Re-read #5 carefully to determine who is the consignor.

Having considered those two, revise your draft solution from your previous post, showing beginning inventory balance, all four items in order, along with your rationale for each, and your proposed ending inventory, in your next post. In other words, very similar to the layout of your previous post.

Oh, you know what... you're good... I think I got #2 wrong. He is the buyer so it should NOT be included because he didn't get it yet until the next year.

#5. I think he is the consignor. It did not say "held" so it must be his products. He should BE included in his inventory. Ok let see:

#2. It should NOT be included in his inventory because it's fob destination. He is the buyer and he didn't get it yet. Since he include it, it should be deducted.
210-30= 180

#3. It should NOT be included because it's consignment. It is owned by the consignor. He include this in his inventory but it should NOT be. So we have to it deduct it 180-14=166

#4. Fob shipping point meaning he can record the sale as soon as the products is in transit even though the buyer is not in possession of the product yet. It should NOT be included in his inventory and he didn't so NO adjustments necessary.

#5. It's consignment but he is the consignor. It should BE included in his inventory. Since he didn't include this. I should add this to his inventory. So
166+15= 181?

So the ending inventory should be $181,000? Hey... I think this is right. I bet it is!! Tell me. My hw due tomorrow. Let me know please asap!! I don't know how to thank you. I like the way you help!
Can you be my tutor?











Good: with your draft solution put together like that, it makes it much easier to analyze where there might remain any issues to de-bug. Now,

Re-read #2 carefully to determine who is the buyer of this merchandise.

Re-read #5 carefully to determine who is the consignor.

Having considered those two, revise your draft solution from your previous post, showing beginning inventory balance, all four items in order, along with your rationale for each, and your proposed ending inventory, in your next post. In other words, very similar to the layout of your previous post.

Yep, you got it... 181K it is. Good job.

I'm glad this thread helped, and I appreciate the compliment. But I'm afraid the ol' overbooked schedule leaves no time for tutoring.

But consider: You solved the problem yourself. All I did was to remind you to...

• Read the problem very carefully, multiple times if necessary (and for me, at least, it's usually necessary).

• Read slowly, consider each fact presented, and absorb its meaning.

• Organize your thoughts in a logical and systematic progression toward an answer.

• Take your time with your calculations.

That's all I contributed; you did the rest yourself. So if you'll remind yourself of those same points when you're tackling a problem, you'll be your own tutor.

You'll do fine. Best of success with your studies and beyond.

Thank you , thank you, thank you! You are awesome. I learn a lot. Yes, I will keep your advice in mind. Keep helping. You are making a big difference in student's life.☺




Yep, you got it...181K it is. Good job.

I'm glad this thread helped, and I appreciate the compliment. But I'm afraid the ol' overbooked schedule leaves no time for tutoring.

But consider: You solved the problem yourself. All I did was to remind you to...

• Read the problem very carefully, multiple times if necessary (and for me, at least, it's usually necessary).

• Read slowly, consider each fact presented, and absorb its meaning.

• Organize your thoughts in a logical and systematic progression toward an answer.

• Take your time with your calculations.

That's all I contributed; you did the rest yourself. So if you'll remind yourself of those same points when you're tackling a problem, you'll be your own tutor.

You'll do fine. Best of success with your studies and beyond.