Consigned merchandise

Consigned merchandise - purchaser has not yet received it....

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Consigned merchandise . Consigned merchandise is merchandise sold on behalf of  another company or individual, who retains title to it. Although the seller (consignee) of  the merchandise displays the items, only the owner (consignor) includes the items in  inventory. Therefore, companies that sell goods on consignment must be careful to  exclude from inventory those items provided by consignors.  Goods in transit . Goods in transit must be included in either the seller's or the buyer's  inventory. When merchandise is shipped  FOB (free on board) shipping point , the  purchaser pays the shipping fees and gains title to the merchandise once it is shipped.  Therefore, the merchandise must be included in the purchaser's inventory even if the 
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Unformatted text preview: purchaser has not yet received it. When merchandise is shipped FOB (free on board) destination , the seller pays the shipping fees and maintains title until the merchandise reaches the purchaser's place of business. Such merchandise must be included in the seller's inventory until the purchaser receives it. In addition to counting merchandise on hand, therefore, someone must examine the freight terms and shipping and receiving documents on purchases and sales just before and just after the count takes place to establish a more complete and accurate inventory count....
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