Costs included in the value of inventory are
A) Purchase price less discounts
B) Transportation-in
C) Storage
D) Insurance
E) All of the above

Question

Quizplus · Accepted Answer

All of the above costs are included in the value of inventory. Purchase price less discounts is the cost of acquiring the inventory, transportation-in is the cost of transporting the inventory to its location, storage is the cost of keeping the inventory safe, and insurance is the cost of protecting the inventory in case of loss or damage. All of these costs are necessary to get the inventory to its final location and ready for sale, so they are all included in the value of inventory.

Costs Included in the Value of Inventory Are