When a Company Ships Goods to a Customer and Pays

question 126

Multiple Choice

When a company ships goods to a customer and pays for freight out,how is that cost recorded?

• A) As an operating expense
• B) As an addition to the cost of inventory
• C) As a reduction of sales revenue
• D) As an addition to cost of goods sold

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Definitions:

Columbian Exchange

The widespread transfer of plants, animals, culture, human populations, technology, and ideas between the Americas and the Old World following Columbus's voyages.

Tomatoes

Edible, often red, fruit of the plant Solanum lycopersicum, commonly used in cooking and eaten in a variety of ways worldwide.

Peanuts

A legume crop grown mainly for its edible seeds, known scientifically as Arachis hypogaea.

Ritual Sacrifices

Religious or ceremonial acts involving the offering of gifts or the killing of animals or humans to a deity or higher power, intended as a form of worship, appeasement, or thanksgiving.