FOB shipping point

(noun)

the buyer pays shipping cost and takes responsibility for the goods when the goods leave the seller's premises

Related Terms

  • Incoterm
  • deposits in transit
  • FOB destination
  • purchase discount

Examples of FOB shipping point in the following topics:

  • Recording Purchases

    • When purchases should be added to inventory depends on the Free On Board (FOB) policy of the trade.
    • For the purchaser, this new inventory is added on shipment (and the seller removes the item from inventory when it is shipped by the seller) if the policy was FOB shipping point.
    • FOB is an abbreviation which pertains to the shipping of goods.
    • Precise meaning and usage of "FOB" can vary significantly.
    • The initials FOB represent ownership and responsibilities involving the shipping and receiving of goods.
  • Economic Order Quantity Technique

    • Variables for the function are: Q = order quantity, Q*= optimal order quantity, D = annual demand quantity, S = fixed cost per order (not per unit, typically cost of ordering and shipping and handling.
    • The single-item EOQ formula finds the minimum point of the following cost function:
    • To determine the minimum point of the total cost curve, partially differentiate the total cost with respect to Q (assume all other variables are constant) and set to 0:
    • Equation to determine the minimum point of the total cost curve.
  • Types of Risk

    • When interest rates climbed 2 percentage points and the mortgage climbed to $2000, some owners had to default (stop making payments) .
    • The home loans were packaged and shipped off to investors all over the world in the form of complex investment vehicles.
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