Freight which is the responsibility of the seller and paid by the seller.Group of answer choicesFOB SP, CollectFOB DP, PrepaidFOB DP, CollectFOB SP, Prepaid
Question
Freight which is the responsibility of the seller and paid by the seller.
Group of answer choices:
- FOB SP, Collect
- FOB DP, Prepaid
- FOB DP, Collect
- FOB SP, Prepaid
Solution
The freight that is the responsibility of the seller and paid by the seller is FOB Destination Point, Prepaid (FOB DP, Prepaid).
Here's why:
FOB stands for "Free On Board," which is a term in international commercial law specifying at what point respective obligations, costs, and risk involved in the delivery of goods shift from the seller to the buyer.
- FOB Shipping Point (FOB SP) means the buyer is responsible for the freight charges and risks of transportation.
- FOB Destination Point (FOB DP) means the seller is responsible for the freight charges and risks of transportation.
When it's mentioned "Prepaid," it means the seller is responsible for the freight charges. "Collect" means the buyer is responsible for the freight charges.
So, in your case, the freight which is the responsibility of the seller and paid by the seller would be FOB DP, Prepaid.
Similar Questions
Which of the following is reported as part of the operating expenses?Group of answer choicesFreight-inFreight-outCost of salesSales allowances
Freight In and Purchases Returns and Allowances are deducted from Purchases to determine the cost of goods sold.
Distribution Logistics are concerned withQuestion 4Answera.make or buy decisionsb.supplier managementc.orderingd.Delivery of finished goods
Which of the following is a componet of outbund logistics?Select one:a.Packagingb.Warehousingc.Stagingd.All of these
Which of these are not components of supply chain management? A. Planning B. Sourcing C. Delivering D. Transporting
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.