ac210 at University of Alabama

5. FOB Shipping

in Chapter 6 (Problem 5 of 8)

Determine the effect on a company’s Assets and Net Income from the following transaction: a company using the perpetual inventory method ships goods costing $5,000 to a customer FOB shipping point. The sale price is $8,000.

Assets Net Income
A Decreased Decreased
B Decreased No effect
C Increased No effect
D Increased Increased
E None of the above
Watch Solution (3:18) Hide Solution Reveal Solution

The Rest Of The Practice Problems

Click Here to View All Chapter 6 Problems at Once View
1 Consignment Inventory Easy
2 FOB Destination Easy
3 Inventory Set Aside Easy
4 Categorizing Cash & Cash Equivalents Moderate
5 FOB Shipping
You are here. 		Moderate
6 FOB Shipping Moderate
7 Bank Reconciliation Hard
8 The Effect of Inventory Errors Hard
← Chapter 4

Chapter 6 Videos

1 Cash and Cash Equivalents 7:52
2 Bank Reconciliations: What and Why 9:38
3 Bank Reconciliations: How 20:57
4 Debit and Credit Memos 5:21
5 Fixing Mistakes in Bank Recs 8:32
6 COGS and Inventory 2:57
7 Net Sales 10:03
8 Perpetual vs Periodic 7:10
9 FOB Shipping? 8:51
10 Transportation In 8:41
11 COGS 6:18
12 Drawbacks to Periodic 6:07
Chapter 8 →