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The unadjusted physical inventory of ABC Company at December 31, 20X3 was P5,000,000. Other information follows: Goods were received and recorded on January 4, 20X4 with cost of P500,000. These goods were shipped by suppliers on December 29, 20X3, FOB shipping point. Goods in the warehouse costing P1,500,000 were billed to the customer FOB shipping point on December 29, 20X3. The goods were included in inventory because they were shipped on January 3, 20X4. How much should ABC report as inventory on its December 31, 20X3 balance sheet? a. 4,000,000 b. 7,000,000 c. 5,000,000 d. 5,500,000

The unadjusted physical inventory of ABC Company at December 31, 20X3 was P5,000,000. Other information follows: Goods were received and recorded on January 4, 20X4 with cost of P500,000. These goods were shipped by suppliers on December 29, 20X3, FOB shipping point. Goods in the warehouse costing P1,500,000 were billed to the customer FOB shipping point on December 29, 20X3. The goods were included in inventory because they were shipped on January 3, 20X4. How much should ABC report as inventory on its December 31, 20X3 balance sheet? a. 4,000,000 b. 7,000,000 c. 5,000,000 d. 5,500,000

Financial Accounting
Financial Accounting
15th Edition
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter7: Inventories
Section: Chapter Questions
Problem 7PB: Selected data on merchandise inventory, purchases, and sales for Jaffe Co. and Coronado Co. are as...
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7. The unadjusted physical inventory of ABC Company at December 31, 20X3 was P5,000,000. Other information follows:

  • Goods were received and recorded on January 4, 20X4 with cost of P500,000. These goods were shipped by suppliers on December 29, 20X3, FOB shipping point.
  • Goods in the warehouse costing P1,500,000 were billed to the customer FOB shipping point on December 29, 20X3. The goods were included in inventory because they were shipped on January 3, 20X4. How much should ABC report as inventory on its December 31, 20X3 balance sheet?

a. 4,000,000

b. 7,000,000

c. 5,000,000

d. 5,500,000

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