Wilkinson & Company sells plumbing supplies across the United States. Wilkinson uses Chicago as its central location for determining freight costs regardless of the city from which products are actually shipped. For example, a Dallas customer pays the freight cost from Chicago to Dallas even if the goods are shipped from Dallas. Wilkinson most likely uses ________ pricing.
A) basing-point
B) FOB-origin
C) freight-absorption
D) zone
E) reference

Question

Quizplus · Accepted Answer

This scenario describes the use of basing-point pricing, which involves setting a base or reference point for determining freight costs, regardless of where the goods are actually shipped from. In this case, Chicago is the basing point for Wilkinson & Company.

Wilkinson & Company Sells Plumbing Supplies Across the United States