41. Goods purchased during December totaleda. 11,600 unitsb. 15,800 unitsc. 19,500 unitsd. 8,000 units42. How many units were sold during December?a. 138,630 unitsb. 113,830 unitsc. 98,630 unitsd. 153,830 units43. How many units should be included in Savage, Inc.’s inventory at December 31, 2007?a. 18,700 unitsb. 39,900 unitsc. 43,500 unitsd. 47,700 units The management of Savage, Inc. has engaged you to assist in the preparation of year-end(December 31) financial statements. You are told that on November 30, the corectinventory level was 145,730 units. During the month of December, sales totaled 138,630units including 40,000 units shipped on consignment to AA Corp. A letter received fromAA indicates that as of December 31, it has sold 15,200 units and was still trying to sellthe remainder.A review of the December purchase orders to various suppliers shows the following:PurchaseQuantityin UnitsInvoiceDateDateTermsOrder DateDateShippedReceived01.05/0812/22/0712/31/0701/02/084,20001/02/08FOB Destination12/05/0701/02/083,60012/17/17FOB DestinationFOB ShippingFOB Shipping12/06/0701/03/087,90001/05/0801.07/0812/20/0701.02/0801.06/0812/18/078,00012/29/0712/22/0701/05/084,60001/04/08FOB Destination12/27/0701/07/083,50001/05/0801/07/08FOB DestinationSavage, Inc. uses the "passing of legal title" for inventory recognition.Page 13 of 20

Consignment Sales: It is an arrangement in which the Seller i.e. the Consignor transfers the goods…

Answered: The management of Savage, Inc. has…

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter2: Accounting For Materials

Section: Chapter Questions

Problem 10P

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Question

41. Goods purchased during December totaled
a. 11,600 units
b. 15,800 units
c. 19,500 units
d. 8,000 units

42. How many units were sold during December?
a. 138,630 units
b. 113,830 units
c. 98,630 units
d. 153,830 units

43. How many units should be included in Savage, Inc.’s inventory at December 31, 2007?
a. 18,700 units
b. 39,900 units
c. 43,500 units
d. 47,700 units

The management of Savage, Inc. has engaged you to assist in the preparation of year-end
(December 31) financial statements. You are told that on November 30, the corect
inventory level was 145,730 units. During the month of December, sales totaled 138,630
units including 40,000 units shipped on consignment to AA Corp. A letter received from
AA indicates that as of December 31, it has sold 15,200 units and was still trying to sell
the remainder.
A review of the December purchase orders to various suppliers shows the following:
Purchase
Quantity
in Units
Invoice
Date
Date
Terms
Order Date
Date
Shipped
Received
01.05/08
12/22/07
12/31/07
01/02/08
4,200
01/02/08
FOB Destination
12/05/07
01/02/08
3,600
12/17/17
FOB Destination
FOB Shipping
FOB Shipping
12/06/07
01/03/08
7,900
01/05/08
01.07/08
12/20/07
01.02/08
01.06/08
12/18/07
8,000
12/29/07
12/22/07
01/05/08
4,600
01/04/08
FOB Destination
12/27/07
01/07/08
3,500
01/05/08
01/07/08
FOB Destination
Savage, Inc. uses the "passing of legal title" for inventory recognition.
Page 13 of 20

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