Final answer:
FOB cost covers manufacturing, transportation to the port, and loading onto the shipping vessel, but does not include the cost of trims and packaging, which are the buyer's responsibility.
Step-by-step explanation:
The acronym FOB stands for Free on Board or Freight on Board, and it is a term used in international shipping to indicate that the seller is responsible for the goods only until they are loaded onto the shipping vessel. After that point, the buyer assumes responsibility for the shipment. FOB cost typically includes the cost of manufacturing the goods, the transportation of the goods to the port of shipment, and the loading costs.
However, FOB costs do not cover additional expenses such as the cost of trims and packaging. Trims refer to all the secondary components used in the manufacture of clothing, such as buttons, zippers, and labels, while packaging involves materials and processes to safely wrap and protect the goods during transit. These costs are generally considered to be the buyer's responsibility unless specially agreed upon in the terms of the sale.