Merchandise that is not owned by the party in possession of the goods. For example, a craftsperson might have produced 100 ornate wood items. In order to sell the items, the person asks a local merchant to take five of the items on consignment. This means that the merchant has possession of the five items and will attempt to sell them for a commission, but the merchant does not own the items. Those five items are consigned goods. (When the merchant sells one of the items, the merchant might be required to remit 80% of the selling price to the craftspersons and can keep 20% as a commission.) The merchant is the consignee and the craftsperson is the consignor.
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For the past 52 years, Harold Averkamp (CPA, MBA) has
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