The purchasing agent of the clampett company ordered materials of lower quality in an effort to economize on price and in response to the demands of the production manager due to a mistake in production scheduling. the materials were shipped by airfreight at a rate higher than that ordinarily charged for shipment by truck, resulting in an unfavorable materials price variance. the lower quality material proved to be unsuitable on the production line and resulted in excessive waste. in this situation, who should be held responsible for the materials price and quantity variances?

On june 3, teal company sold to chester company merchandise having a sale price of $2,600 with terms of 2/10, n/60, f. o.b. shipping point. an invoice totaling $91, terms n/30, was received by chester on june 8 from john booth transport service for the freight cost. on june 12, the company received a check for the balance due from chester company. prepare journal entries on the teal company books to record all the events noted above under each of the following bases. (1) sales and receivables are entered at gross selling price. (2) sales and receivables are entered at net of cash discounts.