Incoterms Assessment

14 Questions | Total Attempts: 357

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Incoterms Assessment

Questions and Answers
  • 1. 
    At what point does risk transfer from the seller to the buyer if the terms of shipment are DAP(destination address)?
    • A. 

      Once the goods are handed over to the first carrier or forwarder.

    • B. 

      Once goods are delivered at the destination address.

    • C. 

      Once goods leave the factory at origin.

  • 2. 
    When the Incoterm is Ex Works, the buyer's nominated freight forwarder must arrange for the loading of the goods into the truck at the factory.  In practice, the seller assts in this risk.  
    • A. 

      True

    • B. 

      False

  • 3. 
    Which is the only Incoterm that requires the seller to pay customs duty in the destination country? 
    • A. 

      DAP

    • B. 

      FOB

    • C. 

      DDP

  • 4. 
    Select all of the charges listed that should be paid by the shipper according to the INCOTERMS DAP- Consignee.
    • A. 

      Export Formalities

    • B. 

      Foreign Pre Carriage

    • C. 

      Freight costs to port of discharge

    • D. 

      Devanning/handling at port of discharge

    • E. 

      Inland costs(IPI) to destination terminal for Customs Clearance(Place of delivery on HBOL).

    • F. 

      Terminal handling at place of delivery on HBOL.

    • G. 

      U S Customs Clearance

    • H. 

      Duties

    • I. 

      Insurance

    • J. 

      Delivery to the customer door

  • 5. 
    Select all of the charges/responsibilities listed that should be paid by the shipper according to the INCOTERMS EX Works .
    • A. 

      Export Formalities

    • B. 

      Foreign Pre carriage

    • C. 

      Freight costs to port of discharge

    • D. 

      Devanning/handling at port of discharge

    • E. 

      Inland Costs(IPI)to destination terminal for Customs Clearance(place of delivery on HBOL)

    • F. 

      Terminal Handling at place of delivery on HBOL

    • G. 

      U S Customs Clearance

    • H. 

      Duties

    • I. 

      Insurance

    • J. 

      Delivery to the customer door

    • K. 

      Make cargo ready at shipper warehouse.

  • 6. 
    Incoterms are regulated by:
    • A. 

      U S Customs

    • B. 

      International Chamber of Commerce

    • C. 

      World Trade Organization

    • D. 

      United Nations

  • 7. 
    Which Incoterm places the maximum obligation on the buyer and minimum obligations on the seller?
    • A. 

      DDP

    • B. 

      EXW

    • C. 

      FOB

  • 8. 
    Which Incoterm places the maximum obligation on the seller and minimum obligations on the buyer?
    • A. 

      DDP

    • B. 

      EXW

    • C. 

      FOB

  • 9. 
    The seller delivers goods, cleared for export, to the buyer-designated carrier at a named location. This is used for any mode of transport. The seller must load goods onto the buyer's carrier
    • A. 

      CPT

    • B. 

      DAP

    • C. 

      FCA

  • 10. 
    Seller must pay the costs and freight to bring the goods to the port of destination. However, risk is transferred to the buyer once the goods are loaded on the vessel. Insurance for the goods is NOT included.
    • A. 

      CIF

    • B. 

      DAP

    • C. 

      CPT

    • D. 

      CFR

  • 11. 
    What are Incoterms 2010?
    • A. 

      The law relating the international carriage of goods.

    • B. 

      A set of internationally recognized contract terms that define buyer/seller's responsibilities when included in international contracts.

    • C. 

      A shorthand used by the freight industry for indicating whether the buyer or seller pays for freight costs during the shipment of goods.

    • D. 

      A set of contract terms indicating where the title to the goods passes in international shipments.

  • 12. 
    CIP and CIF both: (Select all that apply)
    • A. 

      Indicate the seller must pay for the freight to arrival in buyer's country

    • B. 

      Assume risk for the international movement of goods is the buyer's not the seller's

    • C. 

      Can be used for any mode of transportation

    • D. 

      Indicate the seller must buy cargo insurance in the name of the buyer

  • 13. 
    Goods that are taken in charge at Felixstowe, UK, for transport to Long Beach, California, under the rule "CIP Long Beach, CA, Incoterms 2010."  The seller will arrange and pay for freight to Long Beach, but risk will pass to the buyer upon delivery of the goods to the carrier at Felixstowe, before the main carriage.
    • A. 

      True

    • B. 

      False

  • 14. 
    Select the correct Incoterm 2010 for the following: The seller pays for carriage to the terminal, except for costs related to import clearance, and assumes all the risks up to the point that the goods are unloaded at the terminal.
    • A. 

      DAP

    • B. 

      DAT

    • C. 

      DDP

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