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April 2026, question 74

Valuation, Appraisement and Duty Assessment · Valuation

A&G, a Minneapolis furniture company, has agreed to purchase 5000 bespoke ironing boards from Kraftsmen, a furniture manufacturer in Slovenia. A&G supplies Kraftsmen with the following inputs to use in the production of the ironing boards, free of charge: • Design specifications created by a Dallas-based furniture designer, purchased for a flat fee of $3200.00. • 2500 yards of cotton fabric, which Kraftsmen procured for $2.00 per yard in Slovenia, then shipped to A&G’s screen printer in Mozambique. A&G paid their screen printer to add a design to the fabric for $1.00 per yard, before returning the fabric to Kraftsmen’s factory in Slovenia. A&G imports the ironing boards to the United States in five shipments of 1000 ironing boards each. A&G agrees to pay Kraftsmen $375,000.00 for the entire order of 5000 ironing boards, not including the value of the assists. If A&G chooses for the total assist value to be apportioned over the entire anticipated production of 5000 ironing boards, what is the dutiable value of one shipment of 1000 ironing boards?

  1. $75,500.00
  2. $76,000.00
  3. $76,140.00
  4. $77,140.00
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CBP's answer: A. A: $75,500.00

The price is $375,000 for 5000 boards, so one shipment of 1000 is $75,000. The Dallas design specifications were created in the United States, and the engineering and design assist covers only work undertaken elsewhere than in the United States (152.102(a)(1)(iv)), so they add nothing. The fabric was bought by Kraftsmen, so only the $1.00 per yard printing A&G paid for in Mozambique is an assist: 2,500 yards x $1.00 = $2,500. Apportioned over all 5000 boards (152.103(e)(1)), that is $500 per shipment, giving $75,500.00, so A is right.

If the entire anticipated production using the assist is for exportation to the United States, the total value may be apportioned over (i) the first shipment 19 CFR 152.103(e)(1)
Engineering, development, artwork, design work, and plans and sketches that are undertaken elsewhere than in the United States 19 CFR 152.102(a)(1)(iv)

Search for: apportioned over (iii) the entire anticipated production

CBP's key cites: 19 CFR 151.102

Question and key from CBP's April 2026 exam and answer key. The walk-through is ours; quotes are from the pinned editions in the reference viewer (HTSUS 2026 Basic, 19 CFR 2025 edition).