Answered: Both a retailer and a supplier use…

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter14: Adjustments For A Merchandising Business

Section: Chapter Questions

Problem 9SEB: JOURNAL ENTRIES UNDER THE PERPETUAL INVENTORY SYSTEM Sunita Computer Supplies entered into the...

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Both a retailer and a supplier use perpetual inventory systems. The retailer purchased inventory on terms of FOB shipping point, 2/15 net 45 from its supplier. The next day, the relevant party paid $300 to the shipping company for delivery.

A. Which party would pay for shipping costs? Answer

B. What account would be debited when the entry was made? Answer

Both a retailer and a supplier use perpetual inventory systems. The retailer purchased
inventory on terms of FOB shipping point, 2/15 net 45 from its supplier. The next day, the
relevant party paid $300 to the shipping company for delivery.
A. Which party would pay for shipping costs?
B. What account would be debited when the e Supplier
e?
Retailer

and a supplier use perpetual inventory systems. The retailer purchased
erms of FOB shipping point, 2/15 net 45 from its supplier. The next day, th
paid $300 to the shipping company for delivery.
would pay for shipping costs?
nt would be debited when the entry was made?
Freight out
Cash
Accounts payable
Cost of goods sold
Inventory
Freight in
Inventory expense

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