Rigby Company Buys Merchandise from Shoshone Company with an Invoice

Multiple Choice

Rigby Company buys merchandise from Shoshone Company with an invoice cost of $10,000 and shipping terms of FOB destination.The freight costs amount to $7,000.Which of the following statements is TRUE?

A) Rigby Company will record freight-in costs of $7,000.
B) Shoshone Company will record freight-out costs of $7,000.
C) Shoshone Company will record freight-in costs of $7,000.
D) Rigby Company will have inventory cost of $107,000.