What journal entry is recorded by the consignor when goods are shipped to a consignee?
When a consignor sends goods to a consignee, ownership is not transferred. The consignor would record an entry to change the classification of inventory from on hand (in their warehouse) to inventory on consignment. The accounting records should clearly reflect the value of any inventory that is on consignment as inventory on consignment needs to be disclosed in the financial statements.
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