The carrying cost of inventory should include all of the following costs except
A)purchase costs.
B)sales taxes and transportation costs paid by the purchaser.
C)general administrative costs associated with the purchase of inventory.
D)insurance and storage costs.

Question

Quizplus · Accepted Answer

General administrative costs associated with the purchase of inventory are not considered part of the carrying cost of inventory. Carrying costs typically include costs directly related to holding or storing inventory, such as insurance, storage, and taxes, but not the general administrative overheads.

The Carrying Cost of Inventory Should Include All of the Following