Why this is mistaken
Shipping point and destination terms provide useful starting meanings. The executed contract and the actual transfer event still control the accounting analysis. Read the acceptance and redirection terms first. Then inspect carrier evidence, insurance, and delivery records. Check later events too. Complete that work before assigning the goods.
ASC 606-10-55-82 requires an evaluation of when the customer obtains control. It ties a shipment or delivery conclusion to the contract terms.
Where to watch
When this mistake may appear
- FOB shipping point always belongs to the buyer.
- The bill of lading settles every cutoff question.
- Arrival always proves transfer.
Check your work
Your work may contain this mistake if:
- Assigns goods from a label or location while omitting acceptance, redirection rights, bill-and-hold terms, or other contract evidence.