Write the following in full and explain their meanings: (a) C.I.F. (b) F.O.B. (c) F.A.S....
Write the following in full and explain their meanings: (a) C.I.F. (b) F.O.B. (c) F.A.S. (d) F.O.R. (e) C.F.
Explanation
(a) CIF (Cost, Insurance and Freight): A price quoted C.I.F. means that it includes the cost of goods, insurance premium and transporting the goods to the port of destination. The importer is responsible for other charges thereafter.
(b) FOB (Free on Board): All the expenses until the goods have been placed on board of a ship are borne by the seller while the buyer is responsible for the cost of unloading the goods.
(c) FOR (Free on Rail): This price quotation means that the seller has paid all charges including loading the goods on rail. The buyer has to pay subsequent charges.
(d) FAS (Free Alongside Ship): This price quotation means that the goods are delivered to the side of the ship free and the buyer is reponsible for the cost of loading on to the ship.
(e) C.F (Cost and Freight): This quotation means that the seller is only to pay for the freight while the buyer takes out insurance for the goods as the price quoted includes only the cost of the goods and freight charges