Under Which of the Following Terms Will the Buyer Be

question 155

Multiple Choice

Under which of the following terms will the buyer be required to pay transportation costs?

• A) FOB destination
• B) FOB shipping point
• C) freight out
• D) delivery expense

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Definitions:

Securities

Financial instruments that represent an ownership position in a publicly-traded corporation (stock), a creditor relationship with a governmental body or a corporation (bond), or rights to ownership such as options.

Floatation Costs

The expenses incurred by a company when issuing new securities, including underwriting fees, legal fees, and registration fees.

Firm Commitment

A type of underwriting where an underwriter agrees to buy all the unsold shares in an offering and sell them to the public.

Underwriter

An underwriter is a person or entity that assesses and accepts the risk of another party, often in financial transactions or insurance, determining the terms of coverage or investment suitability.