Freight Charges to A Different Vendor

This FAQ will go over how to split out the freight charges on a PO and map it to a different vendor, so they can be paid but the charges still count against the product cost.

In this example, the items are purchased for $350 and a separate freight vendor is charging $50 for the freight.

This can be done by allocating the freight to the items (including it in their cost) and then putting a negative line on the invoice (as shown below) to a freight expense clearing account to reduce the total to the amount owed the product vendor. In this case, the total of the product being purchased was increased to $400 and the freight expense of $50 was subtracted with a G/L line as seen below.

The actual freight bill would then be posted to the freight expense clearing account as well, to clear it to $0 and show the amount to be paid to the freight vendor.