A company desires to improve its cash flow situation by postponing its customs duties payment until the last possible point in the supply chain. The company should consider using which type of warehouse?
A) Bonded
B) Contract
C) Third-party
D) Government

Question

Quizplus · Accepted Answer

Bonded warehouses are storage facilities that are approved by government customs authorities for the storage of goods on which payment of duties is deferred until the goods are removed. By using a bonded warehouse, the company can store its imported goods without paying customs duties, thus improving its cash flow situation. The customs duties are only paid once the goods are removed from the bonded warehouse and enter the normal supply chain. Therefore, using a bonded warehouse allows the company to postpone its customs duties payment until the last possible point in the supply chain.

A Company Desires to Improve Its Cash Flow Situation by Postponing