A Company Has Purchased Inventory and Received an Invoice That

question 59

Multiple Choice

A company has purchased inventory and received an invoice that requires the buyer to pay the transportation costs for delivering the merchandise. The terms in this case are:

• A)FOB destination.
• B)FOB shipping point.
• C)FOB, 2/10, n/30.
• D)FOB in transit.

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Definitions:

Law Of Supply

A principle stating that, all else being equal, an increase in price results in an increase in quantity supplied.

Law Of Demand

The economic principle that, all else equal, an increase in the price of a good will decrease the quantity demanded, and conversely, a decrease in price will increase the quantity demanded.

Quantity

The amount or number of a material or immaterial entity that is measureable.

Equilibrium Price

The selling price where the amount of products offered is equal to the amount of products consumers want to buy.