Anthony has purchased a new shipment of 50 Bluetooth earbuds that he plans to sell for $99.99 each. The manufacturer informs Anthony that each product will cost Anthony $52, but this does not include the cost of transportation. Even with the extra transportation costs, Anthony is not worried. He believes he can sell all 50 earbuds by the end of the month. After adding up inventory, transportation, storage, and other costs, he determines that his total costs will be $3,750. Refer to Scenario 19.4
1 answer
Question:
Anthony has purchased a new shipment of 50 Bluetooth earbuds that he plans to sell for $99.99 each. The manufacturer informs Anthony that each product will cost Anthony $52, but this does not include the cost of transportation. Even with the extra transportation costs, Anthony is not worried. He believes he can sell all 50 earbuds by the end of the month. After adding up inventory, transportation, storage, and other costs, he determines that his total costs will be $3,750.
Refer to Scenario 19.4. The $52 quote Anthony got was the ____________ price.
a. zone price
b. F.O.B. factory
c. F.O.B. destination
d. freight absorption price
e. base-point price
Refer to Scenario 19.4. The $52 quote Anthony got was the ____________ price.
a. zone price
b. F.O.B. factory
c. F.O.B. destination
d. freight absorption price
e. base-point price
Answers
Answer:B) F.O.B. factory (or FOB shipping point) Explanation:Free on board shipping point means that the buyer takes possession and obtains title of the goods once they leave the supplier's facilities (or shipping dock). This means that the buyer is responsible for any transportation costs (shipping costs + insurance + paperwork) and that the buyer assumes the risks associated to the travelling goods.
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