CONSIGNEE

A
Selling Price 35,000.00
Multiply by: Sold units 8
SALES 280,000.00
Sales Commission (35,000 x 8 x 10%) (28,000.00)
Delivery and Installation Costs (3,000.00)
REMITTANCE ENCLOSED 249,000.00

CONSIGNOR
B
Selling Price 35,000.00
Multiply by: Sold units 8
SALES 280,000.00
COST OF SALES:
Cost of Units sold (25,000 x 8) 200,000.00
Freight charges:
(5,000 /10 units = 500 x 8 units sold) 4,000.00 (204,000.00)
GROSS PROFIT 76,000.00
Commission (35,000 x 8 x 10%) (28,000.00)
Delivery and Installation Costs (3,000.00)
NET PROFIT 45,000.00

C Cost per unit 25,000.00

Unsold unit 2
COST OF UNSOLD UNITS 50,000.00
Deferred Freight charge (500 x 2units) 1,000.00
TOTAL COST OF UNSOLD UNITS 51,000.00

D JOURNAL ENTRIES (profits not kept separately by consignee)

CONSIGNOR

1 Merchandise on Consignment 250,000.00

Shipment on Consignment 250,000.00

2 Merchandise on Consignment 5,000.00

Cash 5,000.00

3 NO ENTRY

4 Cash 249,000.00
Delivery expense 3,000.00
Commission Expense 28,000.00
Consignment Sales 280,000.00
 CONSIGNEE

MEMO ENTRY

NO ENTRY

Consignor Receivable 3,000.00

Cash 3,000.00

Consignor Payable 280,000.00

Consignor Receivable 3,000.00
Commission Revenue 28,000.00
Cash 249,000.00
A CONSIGNEE

Selling Price 20,000.00

Multiply by: Sold units 12
SALES 240,000.00
Shipping costs (4,500.00)
Sales Commission (20,000 x 12 x 5%) (12,000.00)
Delivery Costs to customers (5,000.00) (21,500.00)
REMITTANCE ENCLOSED 218,500.00

CONSIGNOR
B
Selling Price 20,000.00
Multiply by: Sold units 12
SALES 240,000.00
COST OF SALES:
Cost of Units sold (12,000 x 12) 144,000.00
Freight charges:
(4,500 /20 units = 225 x 12 units sold) 2,700.00 (146,700.00)
GROSS PROFIT 93,300.00
Sales Commission (20,000 x 12 x 5%) (12,000.00)
Delivery Costs to customers (5,000.00)
NET PROFIT 76,300.00

C
Direct Cost of Unsold Units (12,000 x 8 unsold units) 96,000.00
Deferred Shipping costs (225 x 8 unsold units) 1,800.00
CONSIGNMENT-OUT ACCOUNT 97,800.00

D SHIPPING COSTS incurred from the warehouse of Consignor to Consignee

shall be deferred regardless of which party paid for it.
DELIVERY COSTS incurred from the Consignee to the customer
shall be treated as an outright expense.

E
CONSIGNOR CONSIGNEE

1 Merchandise on Consignment 240,000.00

Shipment on Consignment 240,000.00 MEMO ENTRY

2 Merchandise on Consignment 4,500.00 Consignor Receivable

 Accounts payable 4,500.00 Cash

3 NO ENTRY Consignor Receivable

Cash

4 Cash 218,500.00 Consignor Payable

Delivery expense 5,000.00 Consignor Receivable
Accounts Payable 4,500.00 Commission Revenue
Commission Expense 12,000.00 Cash
Consignment Sales 240,000.00

RECLASSIFICATION: Consignment - Out Account

Cost of Sales 146,700.00
Advertising Expense 5,000.00
Commission Expense 12,000.00
Consignment Profit 76,300.00
Consignment Sales 240,000.00

Inventory of Consigned Mdse 97,800.00

Consignment-Out 97,800.00

REVERSING ENTRY:
Consignment-Out 97,800.00
Inventory of Consigned Mdse 97,800.00
CONSIGNEE

4,500.00
 4,500.00

5,000.00
5,000.00

240,000.00
9,500.00
12,000.00
218,500.00
A CONSIGNEE

Selling Price 7,000.00

Multiply by: Sold units 12
SALES 84,000.00
Sales Commission (7,000 x 12 x 8%) (6,720.00)
Advertising costs (1,500.00) (8,220.00)
REMITTANCE ENCLOSED 75,780.00

CONSIGNOR
B
Selling Price 7,000.00
Multiply by: Sold units 12
SALES 84,000.00
COST OF SALES:
Cost of Units sold (5,000 x 12) 60,000.00
Freight charges:
(700 /15 units = 46.67 x 12 units sold) 560.00 (60,560.00)
GROSS PROFIT 23,440.00
Sales Commission (7,000 x 12 x 8%) (6,720.00)
Advertising costs (1,500.00)
NET PROFIT 15,220.00

Direct Cost of Unsold Units (5,000 x 3 unsold units) 15,000.00

Deferred Shipping costs (46.67 x 3 unsold units) 140.00
CONSIGNMENT-OUT ACCOUNT 15,140.00

C KEPT SEPARATELY

CONSIGNOR CONSIGNEE

1 Merchandise on Consignment 75,000.00

Shipment on Consignment 75,000.00 MEMO ENTRY

2 Merchandise on Consignment 700.00

Cash 700.00 NO ENTRY

3 NO ENTRY Consignment-In
Cash

4 NO ENTRY Cash
Consignment-In
5 Cash 75,780.00 Consignment-In
Consignment-Out 8,220.00 Consignment-In
Consignment-Out 84,000.00 Commission Revenue
Cash

6 Consignment-Out 15,220.00
Consignment Profit 15,220.00 NO ENTRY

RECLASSIFICATION:
Cost of Sales 60,560.00
Advertising Expense 1,500.00
Commission Expense 6,720.00
Consignment Profit 15,220.00
Consignment Sales 84,000.00

Inventory of Consigned Mdse 15,140.00

Consignment-Out 15,140.00

REVERSING ENTRY:
Consignment-Out 15,140.00
Inventory of Consigned Mdse 15,140.00

*Assembly Cost - considered as INVENTORIABLE COST.

CONSIGNEE

1,500.00
1,500.00

84,000.00
84,000.00
84,000.00
1,500.00
6,720.00
75,780.00
 CONSIGNEE
SALES 13,125.00
Sales Commission (2,625.00)
Assembly costs (360.00) (2,985.00)
REMITTANCE ENCLOSED 10,140.00

CONSIGNOR
SALES 13,125.00
COST OF SALES:
Cost of Units sold [(11,520 / 80) x 50] 7,200.00
Freight charges [(936 / 80) x 50] 585.00 (7,785.00)
GROSS PROFIT 5,340.00
Sales Commission (2,625.00)
Assembly costs (360.00)
NET PROFIT 2,355.00

Direct Cost of Unsold Units [(11,520 / 80) x 30 unsold units] 4,320.00

Deferred Shipping costs [(936 / 80) x 30 unsold units] 351.00
CONSIGNMENT-OUT ACCOUNT 4,671.00

A CONSIGNOR

1 Consignment-Out 11,520.00
Inventory/ Shipment on Consignment 11,520.00

2 Consignment-Out 936.00
Cash 936.00

3 NO ENTRY

4 NO ENTRY

5 Cash 10,140.00
Consignment-Out 2,985.00
Consignment-Out 13,125.00

6 Consignment-Out 2,355.00
Consignment Profit 2,355.00
B SUMMARY OF CONSIGNMENT-OUT entries:
1 11,520.00
2 936.00
5 2,985.00
5 (13,125.00)
6 2,355.00
TOTAL 4,671.00

C RECLASSIFICATION:
Cost of Sales 7,785.00
Advertising Expense 360.00
Commission Expense 2,625.00
Consignment Profit 2,355.00
Consignment Sales 13,125.00

Inventory of Consigned Mdse 4,671.00

Consignment-Out 4,671.00

REVERSING ENTRY:
Consignment-Out 4,671.00
Inventory of Consigned Mdse 4,671.00
 CONSIGNEE

MEMO ENTRY

NO ENTRY

Consignment-In 360.00
Cash 360.00

Cash 13,125.00
Consignment-In 13,125.00

Consignment-In 13,125.00
Consignment-In 360.00
Commission Revenue 2,625.00
Cash 10,140.00

NO ENTRY