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19 CFR Part 152 · 7 questions

19 CFR 152.101 — Basis of appraisement.

Past customs broker license exam questions whose answer rests on 19 CFR 152.101. Drawn from 7 released sittings, April 2021 through October 2022. Every question below is a real released question with the answer CBP credited, the authority it rests on, and an explanation of why that answer is right.

Reading the section itself is one tap away inside the simulator, next to the question, which is how the exam works: open book, against a clock.

April 2021, Q70. A German chemical producer sells chemicals to its related party in the United States at a 30% discount of the price it sells the same chemicals to other unrelated parties in the United States. Its related party also resells the chemicals in the United States to other unrelated parties who use the chemicals in producing other goods. The German chemical producer acts as the importer of record and claims that transaction value is the proper method of appraisement for the importations of chemicals to its related party and to the unrelated parties. The German chemical producer o ffers no explanation as to why its related party receives a 30% discount on the price. Select the CORRECT statement below.

  1. AThe German chemical company is correct that it must use the transaction value method to appraise the importations of chemicals for both the related party and unrelated parties.
  2. BThe German chemical company must use the computed value method to appraise the importations of chemicals for both the related party and unrelated parties because the related party price is influenced by the relationship.
  3. CThe German chemical company must use the transaction value to appraise the importations of chemicals for the unrelated parties, and it may not use this method for the related party because the 30% discount on the price of chemicals is only extended to the related party and this demonstrates that the relationship has influenced the price between the related parties, such that appraisement must follow the valuation hierarchy.
  4. DThe German chemical company must use the deductive value method to appraise the importations of chemicals for both the related party and unrelated parties because the related party price is influenced by the relationship and the chemicals are resold by the related party in the United States.
  5. EThe German chemical company must use the deductive value method to appraise the importations of chemicals for the related party because the chemicals are resold by the related party in the United States, and it must use the transaction value method to appraise the importation of chemicals for the unrelated parties.
Show the answer and explanation
Correct answer: C  · Authority: 19 CFR 152.101(c), 19 CFR 152.103(1)(1)(iii)

The correct answer is C because the transaction value method (19 CFR 152.103) is applicable for unrelated parties, as their transaction price is not influenced by the relationship, but it is not applicable for the related party due to the 30% discount, which indicates the relationship has influenced the price. Under the valuation hierarchy (19 CFR 152.101(b)), when transaction value cannot be used for the related party, the appraiser must proceed to subsequent methods. Options A and B incorrectly assume the same method applies universally, while D and E misapply the deductive value method without justification. The cited authority explicitly prioritizes transaction value for unrelated parties and requires moving to other methods when relationship influence is evident.

April 2026, Q77. Footwear incorporating a protective metal toe-cap imported on or after July 1, 1981 will be determined in accordance with _____.

  1. ASection 402, Tariff Act of 1930 (19 USC 1401a), as amended by section 201, Trade Agreements Act of 1979.
  2. BSection 402, Tariff Act of 1930 (19 USC 1401a)
  3. CStatement of Administrative Action relating to customs valuation, submitted to and approved by Congress along with the Trade Agreements Act of 1979 (Pub. L. 96-39)
  4. DT.D. 81-7, 46 FR 2600, January 12, 1981, as amended by T.D. 89-1, 53 DR 51270, Dec. 21, 1988
Show the answer and explanation
Correct answer: A  · Authority: 6401.10.00, HTSUS; 19 CFR 152.101(a)

The correct answer is A because 19 CFR 152.101(a) explicitly states that footwear classified under HTSUS 6401.10.00, including those with protective metal toe-caps, is appraised under Section 402 of the Tariff Act of 1930, as amended by the Trade Agreements Act of 1979. This aligns with the HTSUS description for 6401.10.00, which applies the valuation rule for this specific commodity. Option B omits the critical amendment by the Trade Agreements Act of 1979, making it incomplete. Option C references a Statement of Administrative Action not cited in the cited authority, and Option D refers to a customs directive (T.D.) rather than the statutory authority governing valuation.

October 2018, Q67. Which of the following is NOT an acceptable basis of appraisement for imported merchandise?

  1. AContract value
  2. BComputed value
  3. CValue of identical merchandise
  4. DTransaction value of similar merchandise
  5. EDeductive value
Show the answer and explanation
Correct answer: A  · Authority: 19 CFR 152.101(b)

The correct answer is A) Contract value because 19 CFR 152.101(b) explicitly lists the acceptable methods of appraisement in a specific order: transaction value, identical merchandise, similar merchandise, deductive value, computed value, and a final method. Contract value is not among these listed methods. The other options (B, C, D, E) are all explicitly referenced in the cited authority as valid bases for appraisement. The absence of contract value in the regulatory text means it is not an acceptable basis under U.S. customs law.

October 2019, Q51. What is the transaction value of the shipment in the following scenario? A U.S. business located in Duluth, Minnesota contracts with a manufacturer in Korea to produce 100 electric motors at a cost of $10 per motor. The U.S. business also contracts with a design company in New York to prepare the schematics for use in the production of the motors at a cost of $5,000. Upon completion, the motors are exported from Korea to China and used in the manufacture of household vacuum cleaners at a cost of $100 per vacuum cleaner. The completed vacuum cleaners are shipped to the U.S. business and an invoice from the China manufacturer in the amount of $10,000 is included in the shipment at the time of importation.

  1. A$1,000
  2. B$5,000
  3. C$10,000
  4. D$11,000
  5. E$15,000
Show the answer and explanation
Correct answer: D  · Authority: 19 CFR 152.101, 19 CFR 152.102(a) and 19 CFR 152.102(a)(iv)

The correct answer is D) $11,000 because the transaction value includes the invoice price of $10,000 for the vacuum cleaners plus the $5,000 design fee under 19 CFR 152.102(a)(iv), which mandates adding costs of technical assistance directly related to the production of the imported merchandise. Option A ($1,000) and B ($5,000) ignore the invoice price or design fee, respectively. Option C ($10,000) omits the design fee, which is required by 19 CFR 152.102(a)(iv). Option E ($15,000) incorrectly adds the motor production cost, which is not part of the transaction value for the vacuum cleaners.

October 2020 (PM), Q66. Which of the following is NOT a valid method of appraisement according to the Trade Agreements Act of 1979?

  1. ATransaction Value
  2. BTransaction Value of Identical Merchandise
  3. CTransaction Value of Similar Merchandise
  4. DDerivative Value
  5. EComputed Value
Show the answer and explanation
Correct answer: D  · Authority: 19 CFR 152.101 67 Credit to All 19 CFR 10.1010, 19 CFR 10.1012, HTSUS General Note 33

The correct answer is D) Derivative Value because the Trade Agreements Act of 1979, as implemented in 19 CFR 152.101(b), explicitly lists five valid methods of appraisement: transaction value, transaction value of identical merchandise, transaction value of similar merchandise, deductive value, and computed value. Derivative Value is not among these methods. The tempting options A, B, C, and E are valid because they correspond directly to the methods outlined in 19 CFR 152.101(b)(1) through (5). The cited authority does not mention "derivative value" as a permissible method, confirming its invalidity.

October 2021, Q61. Which of the following is NOT an acceptable basis of appraisement for imported merchandise?

  1. AContract value
  2. BComputed value
  3. CTransaction value of identical merchandise
  4. DTransaction value of similar merchandise
  5. EDeductive value
Show the answer and explanation
Correct answer: A  · Authority: 19 CFR 152.101(b)

The correct answer is A) Contract value because 19 CFR 152.101(b) explicitly lists the acceptable methods of appraisement in order: transaction value, transaction value of identical merchandise, transaction value of similar merchandise, deductive value, computed value, and a final method. Contract value is not among these listed methods and is not referenced in the cited authority. Options B through E correspond directly to the methods outlined in 152.101(b), making them valid bases for appraisement, while contract value lacks explicit regulatory support.

October 2022, Q32. Which of the following is NOT an acceptable basis for the appraisement of imported merchandise?

  1. AComputed value
  2. BContract value
  3. CTransaction value of identical merchandise
  4. DTransaction value of similar merchandise
  5. EDeductive value
Show the answer and explanation
Correct answer: B  · Authority: 19 CFR 152.101

The correct answer is B) Contract value because 19 CFR 152.101(b) explicitly lists the acceptable methods for appraisement as transaction value, transaction value of identical or similar merchandise, deductive value, computed value, and another unspecified method. Contract value is not among these methods and is not referenced in the cited authority. Options A, C, D, and E are all explicitly mentioned in 152.101(b) as valid bases for appraisement, while B is not.

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