What type of account is freight in quizlet?

What type of account is freight in quizlet?

The Freight in or Transportation In account. This is an expense account, included in cost of goods sold, showing transportation charges for merchandise purchased.

Where are the freight costs to sell goods included quizlet?

*Freight cost is included in inventory price for the buyers books. (seller pays freight costs) Ownership of the goods remains with the seller until the goods reach the buyer.

What is freight quizlet?

Freight-in is considered to be part of the cost of the merchandise and should be included in inventory if the merchandise has not been sold. Transportation out. Same as freight-out. Delivery expense to be paid by the seller when its merchandise is sold with terms of FOB destination.

Is freight in considered a cost of purchasing inventory?

Freight in is considered a cost of purchasing inventory. Under the perpetual inventory system, when a sale is made, both the sale and cost of merchandise sold are recorded. When merchandise that was sold is returned, a credit to sales returns and allowances is made.

Is freight out included in gross profit?

Freight cost incurred by the seller is called freight-out, and is reported as a selling expense which is subtracted from gross profit in calculating net income.

Does freight in affect inventory?

The shipping cost to be paid by the buyer of merchandise purchased when the terms are FOB shipping point. Freight-in is considered to be part of the cost of the merchandise and should be included in inventory if the merchandise has not been sold.