diff --git a/MekHQ/src/mekhq/campaign/unit/Unit.java b/MekHQ/src/mekhq/campaign/unit/Unit.java
index 180cde522f..fd75dd2381 100644
--- a/MekHQ/src/mekhq/campaign/unit/Unit.java
+++ b/MekHQ/src/mekhq/campaign/unit/Unit.java
@@ -1496,27 +1496,26 @@ public Money getSellValue() {
     }
 
     /**
-     * Computes the total cargo capacity of the entity, accounting for transport bays
-     * and mounted equipment designated for cargo, only if the entity is fully crewed.
+     * Calculates the total cargo capacity of the entity, considering the usable capacities of
+     * transport bays and mounted equipment designated for cargo. The calculation is performed only
+     * if the entity is fully crewed.
      *
-     * <p>The total cargo capacity is the sum of the following:</p>
+     * <p>The total cargo capacity is derived from the following:</p>
      * <ul>
-     *   <li>The usable capacities of transport bays that are instances of {@link CargoBay},
-     *       {@link RefrigeratedCargoBay}, or {@link InsulatedCargoBay}, adjusted for damage.</li>
-     *   <li>The tonnage of mounted equipment marked as cargo (via the {@code F_CARGO} flag),
-     *       provided the equipment is operable and located in valid entity sections.</li>
+     *   <li>The usable capacities of transport bays ({@link CargoBay}, {@link RefrigeratedCargoBay},
+     *       or {@link InsulatedCargoBay}), adjusted for existing damage.</li>
+     *   <li>The tonnage of mounted equipment tagged with the {@code F_CARGO} flag, provided
+     *       the equipment is operable and located in non-destroyed sections of the entity.</li>
      * </ul>
      *
-     * <p><strong>Important Considerations:</strong></p>
+     * <p><strong>Special Conditions:</strong></p>
      * <ul>
-     *   <li>The method returns a cargo capacity of zero if the entity is not fully crewed.</li>
-     *   <li>Capabilities of transport bays or mounted equipment that are damaged beyond operability
-     *       or located in destroyed sections are not included in the calculation.</li>
-     *   <li>The computation assumes no external conditions affect the equipment or bays beyond the
-     *       immediate considerations of damage and operability.</li>
+     *   <li>The method returns {@code 0.0} if the entity is not fully crewed.</li>
+     *   <li>Bays or mounted equipment damaged beyond usability are excluded from the total.</li>
+     *   <li>Only equipment in valid (non-destroyed) sections of the entity are considered.</li>
      * </ul>
      *
-     * @return The total cargo capacity of the entity if it is fully crewed; otherwise, {@code 0.0}.
+     * @return The total cargo capacity of the entity if fully crewed; otherwise, {@code 0.0}.
      */
     public double getCargoCapacity() {
         if (!isFullyCrewed()) {
@@ -1552,7 +1551,8 @@ public double getCargoCapacity() {
             if (mounted.getType().hasFlag(F_CARGO)) {
                 // isOperable doesn't check if the mounted location still exists, so we check for
                 // that first.
-                if ((entity.getInternal(mounted.getLocation()) != 0) && (mounted.isOperable())) {
+                if (!mounted.getEntity().isLocationBad(mounted.getLocation())
+                    && (mounted.isOperable())) {
                     capacity += mounted.getTonnage();
                 }
             }
diff --git a/MekHQ/unittests/mekhq/campaign/unit/GetCargoCapacityTest.java b/MekHQ/unittests/mekhq/campaign/unit/GetCargoCapacityTest.java
new file mode 100644
index 0000000000..9d2c19d60a
--- /dev/null
+++ b/MekHQ/unittests/mekhq/campaign/unit/GetCargoCapacityTest.java
@@ -0,0 +1,309 @@
+package mekhq.campaign.unit;
+
+import megamek.common.*;
+import megamek.common.icons.Portrait;
+import megamek.logging.MMLogger;
+import mekhq.campaign.Campaign;
+import mekhq.campaign.CampaignOptions;
+import mekhq.campaign.personnel.Person;
+import org.junit.jupiter.api.BeforeEach;
+import org.junit.jupiter.api.Test;
+
+import java.util.UUID;
+
+import static megamek.common.MiscType.F_CARGO;
+import static org.junit.jupiter.api.Assertions.assertEquals;
+import static org.junit.jupiter.api.Assertions.assertNotNull;
+import static org.mockito.Mockito.mock;
+import static org.mockito.Mockito.when;
+
+/**
+ * CargoCapacityTest is a test suite for verifying the cargo capacity calculations of different
+ * entity types. It ensures that factoring accurately computes the cargo capacity in the state of
+ * transport bays, mounted equipment, and damage to specific locations.
+ *
+ * <p>The test primarily validates conditions where:</p>
+ * <ul>
+ *     <li>All systems are operational.</li>
+ *     <li>Damage is applied to specific locations or bays.</li>
+ *     <li>All systems are destroyed.</li>
+ * </ul>
+ */
+
+class CargoCapacityTest {
+    MMLogger logger = MMLogger.create(CargoCapacityTest.class);
+
+    private Campaign mockCampaign;
+    private CampaignOptions mockCampaignOptions;
+
+    private final String CARGO_MEK = "Buster BC XV-M-B HaulerMech MOD";
+    private final CargoUnit cargoMek = new CargoUnit(CARGO_MEK, 0, 2);
+
+    private final String CARGO_DROP_SHIP = "Hoshiryokou (Tug Boat)";
+    private final CargoUnit cargoDropShip = new CargoUnit(CARGO_DROP_SHIP, 7, 100);
+
+    private final String CARGO_FIGHTER = "Caravan Heavy Transport";
+    private final CargoUnit cargoFighter = new CargoUnit(CARGO_FIGHTER, 60, 0);
+
+    private final String CARGO_TANK = "Prime Mover (LRM)";
+    private final CargoUnit cargoTank = new CargoUnit(CARGO_TANK, 0, 20);
+
+    @BeforeEach
+    public void setup() {
+        mockCampaign = mock(Campaign.class);
+        mockCampaignOptions = mock(CampaignOptions.class);
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoMek() {
+        Entity entity = createEntity(cargoMek.name);
+        testCargoTotal(entity, cargoMek.getTotalCargoCapacity());
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoMekKilledLocations() {
+        Entity entity = createEntity(cargoMek.name);
+        assertNotNull(entity);
+        killCargoLocations(entity);
+        testCargoTotal(entity, cargoMek.bayCargoCapacity);
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoMekKilledBays() {
+        Entity entity = createEntity(cargoMek.name);
+        assertNotNull(entity);
+        killBays(entity);
+        testCargoTotal(entity, cargoMek.otherCargoCapacity);
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoMekKillEverything() {
+        Entity entity = createEntity(cargoMek.name);
+        assertNotNull(entity);
+        killCargoLocations(entity);
+        killBays(entity);
+        testCargoTotal(entity, 0);
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoDropShip() {
+        Entity entity = createEntity(cargoDropShip.name);
+        testCargoTotal(entity, cargoDropShip.getTotalCargoCapacity());
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoDropShipKilledLocations() {
+        Entity entity = createEntity(cargoMek.name);
+        assertNotNull(entity);
+        killCargoLocations(entity);
+        testCargoTotal(entity, cargoMek.bayCargoCapacity);
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoDropShipKilledBays() {
+        Entity entity = createEntity(cargoMek.name);
+        assertNotNull(entity);
+        killBays(entity);
+        testCargoTotal(entity, cargoMek.otherCargoCapacity);
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoDropShipKillEverything() {
+        Entity entity = createEntity(cargoMek.name);
+        assertNotNull(entity);
+        killCargoLocations(entity);
+        killBays(entity);
+        testCargoTotal(entity, 0);
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoFighter() {
+        Entity entity = createEntity(cargoFighter.name);
+        testCargoTotal(entity, cargoFighter.getTotalCargoCapacity());
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoFighterKilledLocations() {
+        Entity entity = createEntity(cargoMek.name);
+        assertNotNull(entity);
+        killCargoLocations(entity);
+        testCargoTotal(entity, cargoMek.bayCargoCapacity);
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoFighterKilledBays() {
+        Entity entity = createEntity(cargoMek.name);
+        assertNotNull(entity);
+        killBays(entity);
+        testCargoTotal(entity, cargoMek.otherCargoCapacity);
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoFighterKillEverything() {
+        Entity entity = createEntity(cargoMek.name);
+        assertNotNull(entity);
+        killCargoLocations(entity);
+        killBays(entity);
+        testCargoTotal(entity, 0);
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoTank() {
+        Entity entity = createEntity(cargoTank.name);
+        testCargoTotal(entity, cargoTank.getTotalCargoCapacity());
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoTankKilledLocations() {
+        Entity entity = createEntity(cargoMek.name);
+        assertNotNull(entity);
+        killCargoLocations(entity);
+        testCargoTotal(entity, cargoMek.bayCargoCapacity);
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoTankKilledBays() {
+        Entity entity = createEntity(cargoMek.name);
+        assertNotNull(entity);
+        killBays(entity);
+        testCargoTotal(entity, cargoMek.otherCargoCapacity);
+    }
+
+    @Test
+    public void testCargoCapacityOfCargoTankKillEverything() {
+        Entity entity = createEntity(cargoMek.name);
+        assertNotNull(entity);
+        killCargoLocations(entity);
+        killBays(entity);
+        testCargoTotal(entity, 0);
+    }
+
+    /**
+     * Creates an {@link Entity} from the given unit name by retrieving its information from the
+     * cache.
+     *
+     * <p>If the unit cannot be found or loaded, appropriate error logging occurs, and {@code null}
+     * is returned.
+     * </p>
+     *
+     * @param unitName The name of the unit to retrieve and parse.
+     * @return The {@link Entity} representing the unit, or {@code null} if the unit cannot be loaded.
+     */
+    private Entity createEntity(String unitName) {
+        MekSummary mekSummary = MekSummaryCache.getInstance().getMek(unitName);
+        if (mekSummary == null) {
+            logger.error("Cannot find entry for {}", unitName);
+            return null;
+        }
+
+        MekFileParser mekFileParser;
+
+        try {
+            mekFileParser = new MekFileParser(mekSummary.getSourceFile(), mekSummary.getEntryName());
+        } catch (Exception ex) {
+            logger.error("Unable to load unit: {}", mekSummary.getEntryName(), ex);
+            return null;
+        }
+
+        return mekFileParser.getEntity();
+    }
+
+    /**
+     * Verifies the calculated cargo capacity of a given entity against an expected value.
+     *
+     * <p>To ensure accurate calculations, this method creates and fully crews a {@link Unit} entity,
+     * then compares the reported cargo capacity to the expected value.</p>
+     *
+     * <p>Mock {@link Person} crew members are added to satisfy crewing requirements.
+     * Drivers, gunners, and vessel crew are set up as needed by the entity being tested.</p>
+     *
+     * @param entity            The {@link Entity} whose cargo capacity is to be tested.
+     * @param expectedCargoTotal The expected total cargo capacity for the provided entity.
+     */
+    private void testCargoTotal(Entity entity, double expectedCargoTotal) {
+        Unit unit = new Unit(entity, mockCampaign);
+
+        while (!unit.isFullyCrewed()) {
+            Person crewMember = mock(Person.class);
+            when(mockCampaign.getCampaignOptions()).thenReturn(mockCampaignOptions);
+            when(crewMember.getPortrait()).thenReturn(mock(Portrait.class));
+            when(crewMember.getId()).thenReturn(mock(UUID.class));
+
+            if (unit.getTotalDriverNeeds() > 0) {
+                unit.addDriver(crewMember);
+                continue;
+            }
+
+            if (unit.getTotalGunnerNeeds() > 0) {
+                unit.addGunner(crewMember);
+                continue;
+            }
+
+            if (unit.getTotalCrewNeeds() > 0) {
+                unit.addVesselCrew(crewMember);
+            }
+        }
+
+        double cargoCapacity = unit.getCargoCapacity();
+        assertEquals(expectedCargoTotal, cargoCapacity);
+    }
+
+    /**
+     * Simulates the destruction of all transport location-based systems for the provided entity.
+     *
+     * <p>This method iterates through all mounted equipment on the entity, identifies those with
+     * the {@code F_CARGO} flag, and marks their locations as destroyed.</p>
+     *
+     * @param entity The {@link Entity} whose transport systems are to be simulated as destroyed.
+     */
+    private void killCargoLocations(Entity entity) {
+        for (Mounted<?> mounted : entity.getMisc()) {
+            if (mounted.getType().hasFlag(F_CARGO)) {
+                if (entity.getInternal(mounted.getLocation()) != IArmorState.ARMOR_NA) {
+                    entity.setInternal(IArmorState.ARMOR_DESTROYED, mounted.getLocation());
+                }
+            }
+        }
+    }
+
+    /**
+     * Simulates the destruction of all transport bays for the provided entity.
+     *
+     * <p>This method identifies and marks all bay-related systems with the {@code F_CARGO} flag as
+     * destroyed.</p>
+     *
+     * @param entity The {@link Entity} whose bays are to be simulated as destroyed.
+     */
+    private void killBays(Entity entity) {
+        for (Mounted<?> mounted : entity.getMisc()) {
+            if (mounted.getType().hasFlag(F_CARGO)) {
+                if (entity.getInternal(mounted.getLocation()) == IArmorState.ARMOR_NA) {
+                    mounted.setDestroyed(true);
+                }
+            }
+        }
+    }
+
+    /**
+     * CargoRecord is an immutable data class representing information about the cargo capacity of
+     * an entity. It contains the name of the entity, the cargo capacity from transport bays, the
+     * cargo capacity from other mounted equipment, and a utility method to calculate the total
+     * cargo capacity.
+     *
+     * @param name             The name of the entity associated with the cargo.
+     * @param bayCargoCapacity The cargo capacity contributed by transport bays.
+     * @param otherCargoCapacity The cargo capacity contributed by other mounted equipment.
+     */
+    public record CargoUnit(String name, double bayCargoCapacity, double otherCargoCapacity) {
+
+        /**
+         * Calculates the total cargo capacity as the sum of {@code bayCargoCapacity} and
+         * {@code otherCargoCapacity}.
+         *
+         * @return The total cargo capacity of the entity.
+         */
+        public double getTotalCargoCapacity() {
+            return bayCargoCapacity + otherCargoCapacity;
+        }
+    }
+}