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The answer can be obtained by looking at the shipping terms in a sales transaction. In practice, there are two general types of shipping terms such as FOB shipping point or FOB destination
FOB stands for Free On Board
FOB shipping point – Goods will be considered as Buyers Goods
FOB destination - Goods will be considered as Sellers Goods
As long as the company already Purchased the goods , and assuming the Balance sheet date is Decemeber 31st - And the title of goods transferred Either by FOB or CIF . Goods should be reported in the Balance sheet at the current assets section as Goods in Transit under the General Account of Inventory .
And immediately after the receiving and adding t the stores should be moved to the inventory main account.
yes, goods in transit it has to be classified.
It will become your inventory on date of supplier Invoice stamped by you.
In this case included in the letters of credit open an account if they are imported or in Tsgelaa Nkhozon account with third parties if the local DOORSTEP until the goods are checked and Giwlha permission to receive my store and evaluate what has been cashed bill
Once the goods have left the country/place of production and is on the way to your place/country it will be accounted as goods in transit.
Only once you have physically received goods at your warehouse it can be classified as "Inventory" in books of accounts. In other words goods which are physically available with you can be classified as "inventory" in such cases.
After you received the goods only recorded as inventory. Otherwise it will affect the accuracy of balancesheet.
After receiving the goods in store only.
Agree with above answer >>>>>>>>>>>>>>>>>>>>>....
Items to be treated as in Transit for inventory purposes.
For the balance sheet, if paid for they are yours!
Purchase Raw material can be treated as inventory in the Balance Sheet only upon physically receiving the Inventory.
But the purchased material for the year end can be shown as Goods in Transit.
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