Asked by Lisbeth Galvan on Jun 29, 2024
Verified
If goods in transit are shipped FOB destination
A) the seller has legal title to the goods until they are delivered.
B) the buyer has legal title to the goods until they are delivered.
C) the transportation company has legal title to the goods while the goods are in transit.
D) no one has legal title to the goods until they are delivered.
FOB Destination
A shipping term where the seller bears shipping costs and retains ownership until the goods reach the buyer's location.
Legal Title
The formal ownership of an asset or property, recognized by law, granting the holder specific rights and responsibilities.
- Describe and utilize the notion of legal ownership, examining its effects on inventory accounting practices.
- Comprehend the significance of goods in transit and consignment arrangements on inventory valuation.
Verified Answer
RQ
ronaldo QuirozJul 03, 2024
Final Answer :
A
Explanation :
Under FOB (Free On Board) destination terms, the seller retains ownership and legal title of the goods until they are delivered to the buyer's specified location. This means the risk of loss or damage remains with the seller until delivery is completed.
Learning Objectives
- Describe and utilize the notion of legal ownership, examining its effects on inventory accounting practices.
- Comprehend the significance of goods in transit and consignment arrangements on inventory valuation.