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In the perpetual system, freight charges added to the buyer's invoice are debited to ________ for the buyer.
A) Sales Discount
B) Merchandise Inventory
C) Sales Returns and Allowances
D) Freight in
Freight Charges
Costs associated with transporting goods from one place to another, typically paid by the buyer or seller depending on the shipping terms.
Merchandise Inventory
Merchandise inventory comprises goods a retail business holds for sale to customers, reflecting the products available for resale.
Freight In
Freight in is the cost associated with transporting goods into a business from suppliers, and is often included in the inventory cost.
- Appreciate the differences between the perpetual and periodic inventory systems.
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Learning Objectives
- Appreciate the differences between the perpetual and periodic inventory systems.
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