Question

B.C. Fruit, Inc. is sending $500,000 of apples to Japan, the payment of which is guaranteed at a future date under the terms of sale. The firm's business manager has asked you whether there is a need to purchase cargo insurance. Indicate whether you would recommend the company purchase its own cargo insurance.

Yes/No.
Explain the answer.

Answer 1

Yes, I would recommend that B.C. Fruit, Inc. purchase cargo insurance for the $500,000 worth of apples being sent to Japan. Cargo insurance provides protection in case the apples are damaged or lost during transportation.

Step-by-step explanation:

Yes, I would recommend that B.C. Fruit, Inc. purchase cargo insurance for the $500,000 worth of apples being sent to Japan. Cargo insurance provides protection in case the apples are damaged or lost during transportation. Shipping goods internationally involves risks such as theft, accidents, or natural disasters. In this case, considering the value of the apples and the importance of the shipment, it is wise to mitigate these risks by obtaining cargo insurance. By purchasing cargo insurance, B.C. Fruit, Inc. would have peace of mind knowing that they are financially protected and can recover the value of the goods if any unforeseen events occur.