Intermediate Accounting (16th Edition)

Published by Wiley
ISBN 10: 1118743202
ISBN 13: 978-1-11874-320-1

Chapter 8 - Valuation of Inventories: A Cost-Basis Approach - Review and Practice - Questions - Page 421: 4

Answer

No. they should not report this amount on its balance sheet. As consignee, it does not own this merchandise and therefore it is inappropriate for it to recognize this merchandise as part of its inventory.

Work Step by Step

The inventory remains as property of the consignor.
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