Cost Accounting Question
You buy a coin for $100 from online auc house. This is the only item you bought at the auction. The buyers fee is 12.5 pct. Shipping is $6. It is the only item purchased on the order. You plan to price it cost plus or based on a MV basis that could be CF, CPG, or an EBay seller. It will have a sticker on back with cost and sell code.
A. You record $112.50 to inventory cost, $6.00 to shipping expense.
B. You record $100.00 to inventory cost, $12.50 to fees expense, $6.00 to shipping expense.
C. You record $118.50 to inventory cost.
What is your practice / preference? The matching principle requires matching expense and revenue in period incurred.