Purchases (debit-normal balance)

Purchase Discount (credit-normal balance) (contra account of purchases)

Purchase Returns and Allowances (credit-normal balance)

SHIPPING TERMS RESPONSIBLE IN SELLER ENTRY BUYER ENTRY

PAYING THE
SHIPPING COST
FOB SHIPPING BUYER FOB SHIPPING NO ENTRY FREIGHT IN
POINT POINT,
FREIGHT
COLLECT

FOB SHIPPING ACCTS RECEIVABLE/ DR FREIGHT IN

POINT, ADVANCES TO AND CR
FREIGHT CUSTOMERS ACCOUNTS
PREPAID PAYABLE
FOB DESTINATION SELLER FOB DR FREIGHT OUT DR ACCOUNTS
DESTINATION, AND CR ACCOUNTS RECEIVABLE
FREIGHT PAYABLE/ADVANCE AND CR CASH
COLLECT S FROM
CUSTOMERS
FOB
DESTINATION,
FREIGHT NO ENTRY
PREPAID
FREIGHT
OUT/DELIVERY
EXPENSE

FOB – FREE ON BOARD

FOB SHIPPING POINT – ANG SELLER HAS TO DELIVER THE GOODS TO COURIER ONLY (BECAUSE THE
OWNERSHIP WAS ALREADY TRANSFERRED WHEN IT REACHED THE COURIER)

- FREIGHT IN

FOB DESTINATION – SELLER HAS TO DELIVER THE GOODS ON THE PLACE OF THE BUYER (TRANSFER OF
OWNERSHIP ONLY TAKES PLACE WHEN YOU ARRIVE INFRONT OF THE BUYER)

- FREIGHT OUT OR DELIVERY EXPENSE

WHO OWNS THE GOODS HABANG NAGLALAKBAY ANG ITEM

FREIGHT COLLECT – IF THE BUYER WILL PAY THE SHIPPING COST, THE COURIER WILL COLLECT PAYMENT
IF THE GOODS WERE DELIVERED

FREIGHT PREPAID – THE COURIER WILL NOT BE DELIVERING THE GOODS IF YOU WILL NOT PAY IN
ADVANCE

SELLER’S BOOK

ACCOUNTS RECEIVABLE OR ADVANCES TO CUSTOMERS - IF YOU PAID THE FREIGHT FOR THE SELLER

PAGE 251 #22

MAY 5 PURCHASES 134,400

FREIGHT IN 6,160

ACCOUNTS PAYABLE 134,400

CASH 6,160

MAY 10 ACCOUNTS PAYABLE 67,200

CASH 67,200

MAY 14 ACCOUNTS RECEIVABLE 69,440

SALES 69,440

MAY 15 ACCOUNTS PAYABLE 67,200

PURCHASE DISCOUNT 2,688

CASH 64,512

MAY 16 FREIGHT OUT 16,80

CASH 1,680
MAY 17 SALES RETURNS AND ALLOWANCES 2,632

ACCOUNTS RECEIVABLE 2,632

MAY 24 CASH 65,471.84

SALES DISCOUNT 1,336.16

ACCOUNTS PAYABLE 66,808

MAY 25 PURCHASES 101,360

CASH 50,680

ACCOUNTS PAYABLE 50,680

FREIGHT IN 5,600

CASH 5,600

MAY 29 ACCOUNTS RECEIVABLE 39,400

CASH 25,000

SALES 64,400

FREIGHT OUT 560

CASH 560

MAY 30 ACCOUNTS PAYABLE 50,680

CASH 49,666.40

PURCHASE DISCOUNT 1,013.60