What accounting subject should the freight of export agency be included in? Does anyone know clearly?
Solved#Export agent#
Our company has export business and has found an export agency to help handle relevant matters. Now it involves the accounting treatment of the freight of export agency, and I'm not quite sure what subject this expense should be included in. Is it selling expenses or some other subject? I hope friends who are knowledgeable in this area can explain it in detail, preferably with the reasons, so that I can understand it more clearly. Thank you!
Professional consultant answers
Jennifer WangYears of service：4Customer Rating：5.0
Market development consultantConsult
The freight of export agency is generally included in the selling expenses subject. The reason is that selling expenses are various expenses incurred in the process of enterprises selling goods and materials and providing labor services, including transportation fees, etc. In export business, the freight is a necessary expenditure to successfully sell the goods to foreign customers and is closely related to sales activities.
If the freight of export agency occurs for a specific order and can clearly correspond to the cost accounting of that order, it can also be considered to be included in the main business cost. However, this situation is relatively rare, and usually selling expenses are more common.
When it is included in the selling expenses, the accounting entry is generally: Debit: Selling expenses - Freight; Credit: Bank deposits, etc. If it is included in the main business cost, the entry is: Debit: Main business cost - Freight; Credit: Bank deposits, etc. In actual operation, it is necessary to accurately judge in combination with the enterprise's financial policies and the essence of the business.
Sarah ZhangYears of service：8Customer Rating：5.0
Document expertConsult
If the freight of export agency occurs before the goods reach the location specified by the customer, it can also be regarded as the expense of the sales link, and it is more appropriate to record it as selling expenses, which is convenient for calculating the sales cost and profit.
William YangYears of service：5Customer Rating：5.0
International logistics consultantConsult
If this freight is closely related to the production link of the product, such as the part of the freight from the factory to the port, it may be considered to be included in the product cost. It depends on the company's financial accounting habits.
Emily LiuYears of service：10Customer Rating：5.0
Settlement and payment expertConsult
Generally, it is still recorded as selling expenses according to the convention. Because from the perspective of the overall sales process, the freight is generated to promote sales, which also conforms to the financial treatment methods of most enterprises.
Elizabeth LiYears of service：3Customer Rating：5.0
Compliance and risk managerConsult
If the enterprise mainly focuses on export business and the freight accounts for a large proportion, in order to accurately calculate the cost, it is also feasible to include it in the main business cost, which can better reflect the real cost situation of the business.
Michelle ChenYears of service：3Customer Rating：5.0
Business coordination consultantConsult
It can be judged according to the frequency of business occurrence. If it occurs occasionally, selling expenses will do; if it occurs frequently and has a great impact on the cost, it is necessary to carefully consider whether to include it in the main business cost.
Robert ChenYears of service：6Customer Rating：5.0
Customer service consultantConsult
I think the key is to see whether this freight can be clearly distinguished and attributed. If it can be directly corresponding to a certain export project, it is reasonable to include it in the main business cost; otherwise, it is selling expenses.
David LiYears of service：6Customer Rating：5.0
Senior customs declaration consultantConsult
For businesses like export agency, most of the freight is still recorded as selling expenses. If the enterprise has special requirements for cost accounting, that's another story.
Joseph ZhouYears of service：10Customer Rating：5.0
Senior foreign trade managerConsult
If the freight is incurred for promotional purposes such as exhibitions, it can also be included in the detailed items of selling expenses - exhibition fees, etc. It mainly depends on the purpose of the expense.
James LiuYears of service：10Customer Rating：5.0
Foreign trade tax refund consultantConsult
In some cases, if the freight is for special purposes such as insurance during the transportation of goods, it may need to be analyzed according to the specific situation, and it is not necessarily simply classified into selling expenses or main business cost.