Problem:
The balance in Iwig Co.'s accounts payable account at December 31, 2004 was $400,000 before any necessary year-end adjustments relating to the following:
Goods were in transit to Iwig from a vendor on December 31, 2004. The invoice cost was $50,000. The goods were shipped f.o.b. shipping point on December 29, 2004 and were received on January 4, 2005.
Goods shipped f.o.b. destination on December 21, 2004 from a vendor to Iwig were received on January 6, 2005. The invoice cost was $25,000.
On December 27, 2004, Iwig wrote and recorded checks to creditors totaling $30,000 that were mailed on January 10, 2005.
In Iwig's December 31, 2004 balance sheet, the accounts payable should be
a. $430,000
b. $450,000.
c. $475,000.
d. $480,000.