Chapter 8, Problem 8.2P

To determine

FOB Shipping point means that the buyer pays all costs incurred for the delivery of goods once the goods is left from the supplier’s warehouse.

Ownership of goods: The ownership is transferred to the buyer when the goods are dispatched from the seller’s place of business.

Bearer of freight: The cost of transportation or shipment charges or freight from the point of origin of shipment to the point of destination is borne by the buyer.

FOB Destination means that the buyer pays all costs incurred for the delivery of goods once the goods is delivered at buyer receiving point.

Ownership of goods: The ownership remains with the seller until the inventory reaches the delivery point.

Bearer of freight: The transportation costs from the point of origin to the point of destination.

To State: whether Company R correctly accounted for each of the given transactions.