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free on board (FOB)

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free on board (FOB)
Used in commodities contracts to indicate the geographical point to which delivery is included in the price. After this point, the buyer is responsible for all risks and delivery costs. The FOB point is only important to someone who sells or buys a futures contract with the intention of making or taking delivery of the specific commodity.

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When shipping the items free on board (FOB) destination (that is, where the title for goods transfers at destination), the contractor is responsible for shipping costs.
Much like Tennessee, Indiana only taxed freight charges if they either were not separately stated or were free on board (FOB) destination charges.
According to F2M's Free on Board (FOB) Delivered Pricing Benchmark service, paper and paperboard manufacturers' raw material costs were approximately $34.
 
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