A merchandising business paid $2,100 to purchase inventory and $150 to have the inventory delivered to its customers. Its product costs were $2,250.

Question

Quizplus · Accepted Answer

The total product cost should include the cost of inventory and any additional costs incurred to get the inventory ready for sale, such as delivery costs. Therefore, the total product cost should be $2,100 (cost of inventory) + $150 (delivery cost) = $2,250, not just $2,250.

A Merchandising Business Paid $2,100 to Purchase Inventory and $150