Question

Determining amounts to be paid on invoices

Determine the amount to be paid in full settlement of each of the following invoices, assuming that credit for returns and allowances was received prior to payment and that all invoices were paid within the discount period:

	Merchandise Invoice Amount	Freight Paid by Seller		Customer Returns and Allowances
a.	$33,500	—	FOB destination, n/30	$1,700
b.	12,700	$310	FOB shipping point, 2/10, n/30	2,500
c.	21,800	—	FOB shipping point, 2/10, n/30	4,200
d.	9,700	170	FOB shipping point, 1/10, n/30	1,100
e.	77,700	—	FOB destination, 2/10, n/30	—

This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below.

Answer 1

FOB Shipping Point:

Dandy transportation point, otherwise called FOB origin, demonstrates that the title and obligation of products move from the merchant to the purchaser when the merchandise are put on a conveyance vehicle.

Since FOB dispatching point moves the title of the shipment of merchandise when the products are put at the transportation point, the legitimate title of those merchandise is moved to the purchaser. In this way, the vender isn't answerable for the products during conveyance.