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25 July, 07:50

Marsh, inc. paid for freight costs on merchandise it shipped to a customer. in what account will marsh record this cost in a perpetual inventory system?

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  1. 25 July, 09:44
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    The answer for this is freight-out

    The entry to record the payment of freight costs for goods shipped to a customer requires a debit to Freight-out and a credit to cash. Freight-out is not part of the cost of inventory; it is a delivery expense and appears among the operating expenses on the income statement.

    In contrast, freight-in is used to record the shipping costs associated with acquiring inventory (note: when using a perpetual inventory system, the shipping cost associated with acquiring inventory is debited to Inventory).
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