Question

Brief Exercise 6-02 Tamarisk, Inc. took a physical inventory on December 31 and determined that goods costing $190,000 were on hand. Not included in the physical count were $29,000 of goods purchased from Sheffield Corp., FOB, shipping point, and $24,000 of goods sold to Wildhorse Co. for $33,000, FOB destination. Both the Sheffield purchase and the Wildhorse sale were in transit at year-end. What amount should Tamarisk report as its December 31 inventory? Ending Inventory $

Answer 1

Answer:

The amount should Tamarisk report as its December 31 inventory is $252,000

Explanation:

The computation of the ending inventory is shown below:

= Stock on hand + goods purchased from Sheffield Corp + goods sold to Wild horse Co.

= $190,000 + $29,000 + $33,000

= $252,000

We considered all the amounts which are given in the question i.e FOB destination and FOB shipping point which is added to the physical inventory on hand.