On Nov 2, Bird Houses Corp. ships merchandise costing $115,000 on consignment to Crafts R Us Stores. Bird Houses pays the freight of $500.
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On Nov 2, Bird Houses Corp. ships merchandise costing $115,000 on consignment to Crafts R Us Stores. Bird Houses pays the freight of $500. Upon sale, Crafts R Us will receive a 10% commission and a 5% allowance to offset its advertising expenses. At the end of the month, Crafts R Us notifies Bird Houses that 40% of the merchandise has been sold for $215,000.
Instructions
Record the journal entries required by the two companies to account for this consignment.
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