Which of the Following Is True Regarding Transportation Costs When

question 40

Multiple Choice

Which of the following is true regarding transportation costs when the shipping term "FOB" is used in a contract for the sale of goods requiring delivery?

• A)The selling price includes transportation costs.
• B)The selling price does not include transportation costs.
• C)Both the buyer and seller bear transportation costs,with the costs being apportioned 50% to the buyer and 50% to the seller.
• D)Both the buyer and seller bear transportation costs,with the costs being apportioned 75% to the buyer and 25% to the seller.
• E)Both the buyer and seller bear transportation costs,with the costs being apportioned 25% to the buyer and 75% to the seller.

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Definitions:

Process Cost Accounting

An accounting method used to track and allocate costs of production by process or department.