Problem 11

Transaction Costs

a. Shipping terms are F.O.B. shipping point, freight collect. Pascual paid the shipping costs on June 17 and remitted P5,880 o

Required:
1. Prepare the entries for Ilano to record the sale and the cash receipt.
Jun-16 Accounts Receivable 6,000
Sales 6,000

Jun-25 Cash 5,880

Sales Discounts 120
Accounts Receivable 6,000

2. Prepare the entries for Pascual to record the purchase, the payment of shipping costs, and the cash remittance
Jun-17 Purchases 6,000
Accounts Payable 6,000

Transportation in 600
Cash 600

Jun-24 Accounts Payable 6,000

Cash 5,880
Purchase Discounts 120

b. Shipping terms are F.O.B. destination, freight prepaid. Ilano paid the shipping costs on June 16. Pascual remitted P5,880 o

Required:
1. Prepare the entries for Ilano to record the sale, the payment of shipping costs, and the cash receipt.
Jun-16 Accounts Receivable 6,000
Sales 6,000

Transportation Out 600

Cash 600

Jun-25 Cash 5,880

Sales Discounts 120
Accounts Receivable 6,000

2. Prepare the entries for Pascual to record the purchase and the cash remittance.
Jun-17 Purchases 6,000
Accounts Payable 6,000

Jun-24 Accounts Payable 6,000

Cash 5,880
 Purchase Discounts 120

c. Shipping terms are F.O.B. shipping point, freight prepaid. Ilano paid the shipping costs on June 16 and added the P660 co

Required:
1. Prepare the entries for Ilano to record the sale and freight payment, and the cash receipt.
Jun-16 Accounts Receivable 6,000
Sales 6,000

Accounts Receivable 600

Cash 600

Jun-25 Cash 6,480

Sales Discounts 120
Accounts Receivable 6,600

2. Prepare the entries for Pascual to record the purchase (with shipping costs added to the invoice from Ilano) and the cash
Jun-17 Purchases 6,000
Accounts Payable 6,000

Transportion In 600
Accounts Payable 600

Jun-24 Accounts Payable 6,000

Cash 6,480
Purchase Discounts 120

d. Shipping terms are F.O.B. destination, freight collect. Pascual paid the shipping costs on June 17 and deducted the P600 fr

Required:
1. Prepare the entries for Ilano to record the sale and freight payment, and the cash receipt.
Jun-16 Accounts Receivable 6,000
Sales 6,000

Transportation Out 600

Accounts Receivable 600

Jun-25 Cash 5,280

Sales Discounts 120
Accounts Receivable 5,400

2. Prepare the entries for Pascual to record the purchase, the freight payment, and the cash remittance.
Jun-17 Purchases 6,000
Accounts Payable 6,000
 Accounts Payable 600
Cash 600

Jun-24 Accounts Payable 5,400

Cash 5,280
Purchase Discounts 120
une 17 and remitted P5,880 on June 24.

the cash remittance

16. Pascual remitted P5,880 on June 24.

ne 16 and added the P660 cost to the invoice sent to Pascual . Pascual remitted P6,480 on June 24.

voice from Ilano) and the cash remittance.

e 17 and deducted the P600 from the amount owed to Ilano. A copy of the freight bill to Ilano was provided eith the June 24 cash remitta

remittance.
d eith the June 24 cash remittance. Pascual remitted P5,280 on June 24.