XYZ Company hires third party to deliver goods to their customer on FOB destination, freight prepaid. On the books of XYZ Company, the entry for the freight under perpetual inventory system is debit Finished Goods credit Accounts Receivable. debit Freight In, credit Accounts Receivable. debit Freight Out, credit Cash. debit Raw Materials, credit Accounts payable.
XYZ Company hires third party to deliver goods to their customer on FOB destination, freight prepaid. On the books of XYZ Company, the entry for the freight under perpetual inventory system is debit Finished Goods credit Accounts Receivable. debit Freight In, credit Accounts Receivable. debit Freight Out, credit Cash. debit Raw Materials, credit Accounts payable.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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XYZ Company hires third party to deliver goods to their customer on FOB destination, freight prepaid. On the books of XYZ Company, the entry for the freight under perpetual inventory system is
debit Finished Goods credit
debit Freight In, credit Accounts Receivable.
debit Freight Out, credit Cash.
debit Raw Materials, credit Accounts payable.
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