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accounting Accounting or Accountancy is the measurement, processing, and communication of financial and non financial information about economic entity, economic entities such as businesses and corporations. Accounting, which has been called the "languag ...
, the concept of a freight expense or freight spend account can be generalized as a payment for sending out a product to a customer. It falls under the umbrella category of
expensesExpenditure is an outflow of money Image:National-Debt-Gillray.jpeg, In a 1786 James Gillray caricature, the plentiful money bags handed to King George III are contrasted with the beggar whose legs and arms were amputated, in the left corner, 174 ...
and is treated like other expense accounts in relation to the
accounting equation The fundamental accounting equation, also called the balance sheet equation, represents the relationship between the assets, liability (accounting), liabilities, and Equity (finance), owner's equity of a person or business. It is the foundation for ...
, however, under generally accepted accounting rules, if the freight is Freight expense has a normal
debit Debits and credits in double entry bookkeeping are entries made in account ledger A ledger is a book or collection of accounts in which account transactions are recorded. Each account has an opening or carry-forward balance, would record tr ...

debit
balance. Increases are recorded as debits while decreases are recorded as
credits Credit refers to any form of deferred payment, the granting of a loan and the creation of debt. Credit may also refer to: Places * Credit, Arkansas, a ghost town Arts, entertainment, and media * Credit (creative arts), acknowledging the ideas o ...
. In relation to other accounts, the Freight Expense account is similar to the "Cost of Sales-Freight" account, but are two totally different entities. While the Freight Expense account is increased for payments towards outgoing goods, the Cost of Sales-Freight account is increased for payments towards incoming goods. For example, suppose you have a business that imports and exports a type of product. When you deliver goods to customers and you pay for the delivery costs, you increase the Freight Expense account with a debit and the Cost of Sales-Freight is unaffected. However, when you purchase goods from a supplier and you pay for the delivery costs, you increase the Cost of Sales-Freight account and the Freight Expense account is unaffected. Expense {{accounting-stub