Asked by taylor harrington on Jun 27, 2024
Verified
The term "FOB" denotes
A) free on board.
B) freight on board.
C) free only (to) buyer.
D) freight charge on buyer.
FOB
Free On Board, a term used in shipping to indicate who is responsible for payment of transportation and insurance.
Freight
The charge paid for the transportation of goods, typically by sea, air, or land.
Free
Not under the control or in the power of another; able to act or be done as one wishes, or without cost or payment.
- Elucidate and implement the principle of legal ownership and its influence on the accounting of inventory.
Verified Answer
MG
Mariah GareisJun 28, 2024
Final Answer :
A
Explanation :
FOB stands for "free on board" which means that the seller is responsible for the cost of transporting the goods to the port of shipment and loading them onto the vessel. Once the goods are loaded, the responsibility shifts to the buyer. Therefore, the buyer is responsible for any further transportation costs and any potential damage or loss of the goods during transportation.
Learning Objectives
- Elucidate and implement the principle of legal ownership and its influence on the accounting of inventory.