Eldervale Winery is a producer of premium wine. Which of the following is an example of an upstream cost?
A) The costs associated with storing wine barrels.
B) The costs associated with designing the labels on a wine bottle.
C) The costs associated with delivering products to customers.
D) The costs associated with quality inspection.

Question

Quizplus · Accepted Answer

Upstream costs are incurred before the production process begins, such as research and development or design costs. Designing the labels on a wine bottle is an example of an upstream cost because it involves planning and creative work that happens before the wine is actually produced and bottled.

Eldervale Winery Is a Producer of Premium Wine