FreeStuff, Inc. operates a website which markets products from various manufacturers. FreeStuff accepts customer orders, forwards those orders and 80% of the customer payment to the appropriate manufacturer who then ships product directly to the customer.
Required:
Prepare the journal entry by FreeStuff when payment is received from a customer for $500 for merchandise to be provided by Handy Manufacturing.

Question

Quizplus · Accepted Answer

The Answer of FreeStuff, Inc. operates a website which markets products from various manufacturers. FreeStuff accepts customer orders, forwards those orders and 80% of the customer payment to the appropriate manufacturer who then ships product directly to the customer.
Required:
Prepare the journal entry by FreeStuff when payment is received from a customer for $500 for merchandise to be provided by Handy Manufacturing.