BM1706
Name: DATE: SCORE:
TRANSACTION ANALYSIS
Instructions: Analyze the following items. On the blank before each number, write RMI if it would be reported
as part of the cost of Raw Materials Inventory, WIP if Work-in-Process Inventory, FGI if Finished Goods
Inventory, MI if Merchandise Inventory Account, and REI if under Real Estate Inventory.
If an item should NOT be included in the cost of inventory, write N/A. Note that the reporting period ends on
December 31. (20 items x 1 point)
_____ 1. Raw materials on hand not yet placed into production by a manufacturing firm
_____ 2. Raw materials on which a manufacturing firm has started production, but which are not completely
processed
_____ 3. Factory labor costs incurred on goods completed but still unsold by a manufacturer
_____ 4. Factory supplies on hand
_____ 5. Costs identified with units completed by a manufacturing firm, but not yet sold
_____ 6. Goods out on consignment at another company’s store
_____ 7. Goods held on consignment from another company
_____ 8. Merchandise purchased FOB shipping point that are in transit at December 31
_____ 9. Merchandise purchased f.o.b. destination that are in transit at December 31
_____ 10. Merchandise sold FOB shipping point that are in transit at December 31
_____ 11. Goods sold FOB destination that are in transit at December 31
_____ 12. Goods sold on an installment basis
_____ 13. Costs incurred to advertise goods held for resale
_____ 14. Interest costs incurred to finance activities associated with making goods ready for sale; the goods
are routinely manufactured items
_____ 15. Interest costs on assets produced as discrete projects (such real estate) for sale
_____ 16. Cost of sales brochures on hand
_____ 17. Investments in stocks and bonds that will likely be sold within the next year
_____ 18. Office supplies on hand
_____ 19. Freight charges on goods purchased for resale
_____ 20. Supplies purchased for use in the delivery and sales functions of the enterprise
Reference
Kieso, D. E. (2016). Intermediate accounting (16th ed.). New York: John Wiley & Sons.
04 Activity 1 *Property of STI
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