On a consignment sale, the payment risk is:
A) assumed by the buyer.
B) assumed to be equally shared.
C) carried by the seller.
D) covered by insurance.
E) covered by the bank issuing the L/C.

Question

Quizplus · Accepted Answer

In a consignment sale, the seller retains ownership of the goods until they are sold, and therefore carries the payment risk. This means the seller is at risk of not receiving payment for the goods if they are not sold or if the buyer defaults on payment. It is the seller's responsibility to ensure that they have a secure payment arrangement in place before entering into a consignment sale.

On a Consignment Sale, the Payment Risk Is