Affectionate Company

Required:
1. FOB destination and freight collect
Debit Credit
a. Accounts Receivable 500,000
Freight out 10,000
Sales 500,000
Allowance for freight charge 10,000

b. Cash 475,000
Sales discount 15,000
Allowance for freight charge 10,000
Accounts receivable 500,000

2. FOB destination and freight prepaid

a. Accounts receivable 500,000

Freight out 10,000
Sales 500,000
Cash 10,000

b. Cash 485,000
Sales discount 10,000
Accounts Receivable 500,000

3. FOB shipping point and freight collect

a. Accounts receivable 500,000

Sales 500,000

b. Cash 485,000
Sales discount 10,000
Accounts Receivable 500,000

4. FOB shipping point and freight prepaid

a. Accounts receivable 510,000

Sales 500,000
Cash 10,000

b. Cash 495,000
Sales discount 15,000
Accounts Receivable 510,000