Freight Terms Determine the amount to be paid in full settlement of each of two invoices, (a) and (b), assuming that credit for returns and allowances was received prior to payment and that all invoices were paid within the discount period. Merchandise Freight Paid by Seller Freight Terms Credit for Refunds and Allowances a. $120,800 $1,300 FOB shipping point, 1/10, n/30 $20,100 b. 147,700 2,100 FOB destination, 2/10, n/30 11,400 a. $fill in the blank 1 100,993 b. $fill in the blank 2 135,674 Feedback a & b. Under FOB shipping point, freight is paid by the buyer, while under FOB destination freight is the seller's expense.

Freight Terms

Determine the amount to be paid in full settlement of each of two invoices, (a) and (b), assuming that credit for returns and allowances was received prior to payment and that all invoices were paid within the discount period.

	Merchandise		Freight Paid by Seller		Freight Terms		Credit for Refunds and Allowances
a.	$120,800		$1,300			FOB shipping point, 1/10, n/30	$20,100
b.	147,700		2,100			FOB destination, 2/10, n/30	11,400

a.	$fill in the blank 1
b.	$fill in the blank 2

Feedback

a & b. Under FOB shipping point, freight is paid by the buyer, while under FOB destination freight is the seller's expense. To determine the amount, first deduct the return before calculating the discount. Then calculate (Purchase Return Discount) + applicable freight.