Inventory costs include
A) carrying costs.
B) ordering costs.
C) shortage costs.
D) all of the above

Question

Quizplus · Accepted Answer

Inventory costs include carrying costs (costs associated with storing inventory such as rent, utilities, insurance, etc.), ordering costs (costs associated with placing and receiving orders such as labor, paperwork, shipping, etc.), and shortage costs (costs associated with running out of stock such as lost sales, customer dissatisfaction, etc.). Therefore, option D, "all of the above" is the correct answer.

Inventory Costs Include