Rudsan Turqueza

Problem #11
Transportation Cost

On June 16, 2021, Ilano sold merchandise to Pascual for P6,000, terms 2/10, n/30
Shipping costs were P600. Pascual Co, received the goods and llano Co.'s invoice on June 17.
On June 24, Pascual Co. sent the payment to llano Co., which llano Co. received on June 25. Both
llano Co. and Pascual Co. use the perpetual inventory system. The following are several
arrangements regarding the shipping costs:

a. Shipping terms are FOB shipping point, frieght collect. Pascual Co. paid the shipping
costs on June 17 and remitted 5880 on june 24.

Required:
1. Prepare the entries for llano Co. to record the sale and cash receipt.
2. Prepare the entries for Pascual Co. to record purchase, the payment of shippng
costs, and the cash remittance.

Required:
1. Prepare the entries for llano Co. to record the sale, the payment of shippng costs,
and the cash receipt.
2 Prepare the entries for Pascual Co. to record purchase and the cash remittance.

c. Shipping terms are FOB shipping point, freight prepaid. Ilano Co. paid the shipping
costs on June 16 and added the 600 cost to the invoice sent to Pascual Co.
Pascual Co. remitted 6480 on june 24.

Required:
1. Prepare the entries for llano Co. to record the sale and freight payment, and the cash receipt.
2. Prepare the entries for Pascual Co. to record the purchase (with shipping costs added to
the invoice from Ilano Co.) and the cash remittance.

d. Shipping terms are FOB destination, freight collect. Pascual Co. paid the shipping
costs on June 17 and deducted the 600 from the amount owed to llano Co. A copy of
the freight bill to Ilano was provided with the June 24 cash remittance. Pascual remitted
P5,280 on June 24.

Required:
1 Prepare the entries for Ilano to record the sale and the cash receipt.
2 Prepare the entries for Pascual to record the purchase, the freight payment, and the cash remittance.
sh remittance.
 Ilanao (Books of Buyers)
Date Particulars Dr Cr
2021 June 16 Accounts Receivables 6,000
Sales 6,000
Sold merchandise to Pascual. Terms 2/10, n/30

25 Cash 5,880
Sales Discount 120
Accounts Receivables 6,000
receive full payment of Pascual
 Pascual (Books of Sellers)
Date Particulars
2021 June 17 Purchases
Accounts Payable
Purchase goods from Ilanao. Terms 2/10, n/30
#
Freight In
Cash
FOB shipping point, freight collect

24 Accounts Payable
Purchase Discount
Cash
6,000 x2% = 120 , 6000 - 120
Dr Cr
6,000
6,000

6,000
120
5,880
 Ilanao (Books of Buyers)
Date Particulars Dr Cr
2021 June 16 Accounts Receivables 6,000
Transportation out 600
Sales 6,000
Cash 600
Sold merchandise to Pascual. Terms 2/10, n/30

25 Cash 5,880
Sales Discount 120
Accounts Receivables 6,000
receive full payment of Pascual
 Pascual (Books of Sellers)
Date Particulars
2021 June 17 Purchases
Accounts Payable
Purchase goods from Ilanao. Terms 2/10, n/30
#
Freight Out
Cash
FOB destination, freight prepaid

24 Accounts Payable
Purchase Discount
Cash
6,000 x2% = 120 , 6000 - 120
Dr Cr
6,000
6,000

6,000
120
5,880