Freight costs paid by a seller on merchandise sold to customers will cause an increasetoa contra-revenue account of the seller.to the cost of goods sold of the seller.in operating expenses for the seller.in the selling expense of the buyer.

In operating expenses for the seller. Explanation:In operating expenses for the seller.When a seller…

Answered: Freight costs paid by a seller on…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Similar questions

When merchandise is sold, the cost of merchandise sold (COMS) is a type of ___________ to the business owner. Group of answer choices asset liability expense revenue
Which of the following needs an adjustment to the accounts receivable account of AB Company? a. a freight cost paid by the buyer for goods shipped FOB shipping point b. freight cost prepaid by the seller for good shipped FOB destination c. freight cost prepaid by the buyer for goods shipped FOB shipping point d. freight cost prepaid by the seller for goods shipped FOB shipping point
Terminology Match each phrase with its definition. A. Sales discount B. Credit period C. Discount period D. FOB destination E. FOB shipping point F. Gross profit G. Merchandise inventory H. Purchases discount 1. 2. 3. 4. 5. 6. 7. 8. Goods a company owns and expects to see to its customers. Time period that can pass before a customer's full payment is due. Seller's description of a cash discount granted to buyers in return for early payment. Ownership of goods is transferred when the seller delivers goods to the carrier. Purchaser's description of a cash discount received from a supplier of goods. Difference between net sales and the cost of goods sold. Time period in which a cash discount is available. Ownership of goods is transferred when delivered to the buyer's place of business. 1
in a merchandising business gross profit is equal to the sales revenue minus (a) the sum of cost of goods sold and sales commissions (b) cost of goods sold (c) the sum of cost of goods sold and operating expenses (d) the sum of cost of goods sold, operating expenses and prepaid expenses
The "dual nature of merchandise transactions" as described in this chapter means every business transaction affects both a/an __________ and a/an ____________. Group of answer choices income statement; balance sheet debit entry and a credit entry buyer; seller asset; expense
Selling expenses DOES NOT include: A. Advertising expense B. Making sales C. Accounting and Human Resources expense D. Delivering goods to customers
When goods are sold on a bill-and-hold basis, what conditions must be met to recognize revenue upon receipt of the order?
Is a customer’s right to return merchandise a performance obligation of the seller? How should sellers account for a right of return?
When the transportation charges are paid by the seller, merchandise is shipped a. FOB destination b. FOB shipping c. FOB carrier d. Prepaid
The amount recorded for net cost of purchases includes all of the following EXCEPT: Purchase discounts. Freight costs paid by the seller. Returns and allowances. Freight costs paid by the buyer.
Who is responsible for the freight cost when the terms are FOB destination? Please explain with full explanation. a. the seller b. the buyer c. the customer d. either the buyer or the seller

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Freight costs paid by a seller on merchandise sold to customers will cause an increase to a contra-revenue account of the seller. to the cost of goods sold of the seller. in operating expenses for the seller. in the selling expense of the buyer.