What we are looking for are the costs (which will all be borne by the buyer eventually) to get the product to various stages along the shipping process- For example: EXW means the goods are sitting outside the seller's shop/factory/loading dock... and the seller has paid for the consular invoice required for export. SO FAR - EXW costs are 40,000 + 50. Of course the buyer then has to arrange everything else to get it to them, but the EXW cost is 40,050.

FAS means free alongside (the ship), not loaded onto the ship. What of the costs below will be figured into the FAS price? 40,050 + ???

I hope this gives you a running start at the exercise. Let me know if you have more questions!

expeditors incoterms.jpeg

Assignment

Find the FAS, FOB, CIF, DAT & DDP prices for the following shipment in one container:

Value of product, packed for export: $40,000.00

Container rental (goes with pre-carriage) $ 300.00

Pre-carriage, loading included $ 750.00

Terminal Handling Charge $ 410.00

Ocean Freight (includes surcharges) $ 3,975.00

Unloading $ 250.00

On-carriage $ 250.00

Import Duties 11% of FOB value

Insurance insure for 110% of CFR value at

$0.52 per $100.

Freight Forwarder Fees (included in FOB) $ 350.00

Consular Invoice (paid by seller) 50.00

Import License fee (paid by buyer) $ 30.00