Which of the following is the correct journal entry for freight paid on goods purchased by a merchandiser using the periodic inventory system?
A) $$\begin{array} { | l | r | r | }
\hline \text { Purchases } & \chi \chi & \
\hline \text { Accounts Payable } & & \chi \chi \
\hline
\end{array}$$
B) $$\begin{array} { | c | r | r | }
\hline \text { Merchandise Inventory } & \chi \chi & \
\hline \text { Cash } & & \chi \chi \
\hline
\end{array}$$
C) $$\begin{array} { | l | r | r | }
\hline \text { Freight In } & \chi \chi & \
\hline \text { Cash } & & \chi \chi \
\hline
\end{array}$$
D) $$\begin{array} { | l | r | r | }
\hline \text { Freight Expense } & \chi \chi & \
\hline \text { Cash } & & \chi \chi \
\hline
\end{array}$$

Question

Which of the following is the correct journal entry for freight paid on goods purchased by a merchandiser using the periodic inventory system?
A) $$\begin{array} { | l | r | r | } 
\hline \text { Purchases } & \chi \chi & \
\hline \text { Accounts Payable } & & \chi \chi \
\hline
\end{array}$$
B) $$\begin{array} { | c | r | r | } 
\hline \text { Merchandise Inventory } & \chi \chi & \
\hline \text { Cash } & & \chi \chi \
\hline
\end{array}$$
C) $$\begin{array} { | l | r | r | } 
\hline \text { Freight In } & \chi \chi & \
\hline \text { Cash } & & \chi \chi \
\hline
\end{array}$$
D) $$\begin{array} { | l | r | r | } 
\hline \text { Freight Expense } & \chi \chi & \
\hline \text { Cash } & & \chi \chi \
\hline
\end{array}$$

Quizplus · Accepted Answer

Under the periodic inventory system, freight costs associated with the purchase of goods are recorded in a separate account, often called "Freight In" or "Transportation In," and not directly to the Merchandise Inventory account. This cost is then allocated to the cost of goods sold at the time of calculating the cost of goods sold at the end of the period.

Which of the Following Is the Correct Journal Entry for Freight