0
What else can I help you with?
What is the difference between FOB destination and FOB shipping point?
FOB (Freight On Board) Destination and FOB Shipping specifies whether the buyer or seller owns the goods, and therefore, who pays for the shipping and includes the items in their inventory. FOB Destination means that the seller owns the goods until the buyer receives them. Therefore, the seller pays the shipping costs. FOB Shipping means that the buyer owns the goods once they are shipped. Therefore, the buyer pays the shipping costs.
How does FOB apply in a normal business transaction?
FOB literally means 'Free on Board'. So "FOB Shipping Point" means that if you buy something and pick it up yourself at the seller's shipping point, then there is no shipping cost to you. Alternatively, the common "FOB Destination" means that there is no shipping cost to get the purchased item to the destination agreed on in the contract. Example: Purchaser of a new International Harvester corn combine. Lets say a deluxe model for $600,000 dollars FOB destination. That means you pay Case/IH 600,000 bucks and they deliver a pristine new harvester to your farm with no shipping cost to you. Normally, shipping a huge piece of machinery like this across the country from their factory to your farm would be many thousands of dollars.
If buyer pays the freight cost of delivering merchandise what is the delivery term?
Free On Board Destination (FOB Destination). This means that the seller pays the the freight costs from the shipping point to the buyer's final destination.
How do I jounal the FOB shipping point?
FOB shipping means the purchaser is paying the shipping charges. If you are the seller debit the charge to the buyer and credit the charge to the shipping company.
Can you capitalize shipping costs?
Yes but only if it's fob shipping point
What is the fob on a bill of lading?
FOB, or "Free on Board," on a bill of lading indicates the point at which ownership and liability for the goods transfer from the seller to the buyer. It specifies whether the seller or buyer is responsible for shipping costs and risks during transit. For instance, if the term is FOB shipping point, the buyer assumes responsibility once the goods leave the seller's location; if FOB destination, the seller retains responsibility until the goods reach the buyer's location.
What does the term FOB mean export?
FOB is an abbreviation for Free On Board. The term FOB (often seen as f.o.b.) is commonly used when shipping goods, to indicate who pays loading and transportation costs, and/or the point at which the responsibility of the goods transfers from shipper to buyer. FOB shipping is the term used when the ownership/liability of goods passes from the seller to the buyer at the time the goods cross the shipping point to be delivered. FOB destination designates that the seller is responsible for the goods until the buyer takes possession. This is important in determining who is responsible for lost or damaged goods when in transit from the seller to the buyer. The buyer is responsible when shipped FOB shipping and the seller is responsible if shipped FOB destination. CAP, or customer arranged pickup, is used to denote that the buyer will arrange a carrier of their choice to pick the goods up and the liability for any damage or loss belongs to the buyer.
If the buyer bears the freight costs related to a purchase the terms are said to be FOB destination. is it true or false?
It is false. FOB destination means that the shipper bears the responsibility for shipping, including costs and liability.
If the buyer is to pay the transportation coats of delivering merchandise delivery terms are stated as?
FOB Shipping point
If title to merchandise purchases passes to the buyer when the goods are shipped from the selle the terms are?
FOB shipping point
Which term indicates that merchandise is free of transportation charges to the buyer?
"Free on Board (FOB) destination" indicates that merchandise is free of transportation charges to the buyer. This means that the seller is responsible for the shipping costs and risk of loss until the goods reach the buyer's specified location.
What is the difference between a shipment contract and a destination contract?
By default, under many state laws, goods remain the property of the seller until they are delivered to the customer's destination, i.e., a destination contract, sometimes including the terms FOB Buyer. Upon agreement, a shipping contract can be FOB Seller, meaning that title transfers once the seller has delivered it to the shipping company, meaning that the buyer would need to buy insurance for the shipment.
