RSM219H1 Chapter Notes - Chapter 7: Inventory Turnover, Combined Gas And Steam, Gross Margin
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RSM219H1 Full Course Notes
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Inventory is any item purchased by a company for: resale to customer, or use in the manufacture of items to be sold to customers. Fob shipping point the ownership transfers at the time of shipment (freight-in, freight-out) Fob destination the ownership at the arrival of the good. Consignment: suppliers put their inventory at the store, they are paid when the goods are sold (the store gets the service revenue only, e. g. uoft bookstore) [ beginning inventory + purchase = cost of good available for sale ] [ cogas = cogs + ending inventory ] cost formulas. Inventory purchase price changes constantly. however the cogas is not a ected under di erent cost formulas. the three di erent formulas result in di erent allocations of cogas between ei and cogs speci c identi cation (not interchangeable goods) Fifo ( rst in rst out) the same under perpetual and periodic.
