FOB Shipping Point

Accounting Dictionary

FOB Shipping Point

FOB shipping point means free on board shipping point. It means that goods you have ordered belong to you as soon as they are delivered to the shipper.

Let’s say you ordered a machine that was shipped to you by rail. The train had an accident and the machine was destroyed. If it was shipped FOB shipping point, you would contact the railroad to get compensated for your loss. The machine belonged to you as soon as it was delivered to the railway station, so you have to deal with the railroad.

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