AICPA Exam CPA-Business Topic 3 Question 82 Discussion

Actual exam question for AICPA's CPA-Business exam

Question #: 82
Topic #: 3

[All CPA-Business Questions]

Which one of the following would not be considered a carrying cost associated with inventory?

AInsurance costs.

BCost of capital invested in the inventory.

CCost of obsolescence.

DShipping costs.

Show Suggested Answer

Suggested Answer: D

Choice 'd' is correct. Shipping costs (which are selling costs) would not be considered a carrying cost associated with inventory.

Choices 'a', 'b', and 'c' are incorrect. Each of the following would be considered a carrying cost associated with inventory.

A Insurance costs.

B Cost of capital invested in the inventory.

C Cost of obsolescence.

by Eun at Mar 09, 2024, 01:36 PM

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Martha

6 months ago

Hmm, you may be right. It does make sense to consider the cost of capital invested in the inventory as a carrying cost.

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Zachary

6 months ago

I'm not sure, but I think B) Cost of capital invested in the inventory is also a carrying cost.

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Rupert

6 months ago

I disagree, I believe it's C) Cost of obsolescence.

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Martha

6 months ago

I think the answer is D) Shipping costs.

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Micaela

7 months ago

Hmm, you may be right. It does make sense to consider the cost of capital invested in the inventory as a carrying cost.

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Amie

7 months ago

I'm not sure, but I think B) Cost of capital invested in the inventory is also a carrying cost.

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Ulysses

7 months ago

I disagree, I believe it's C) Cost of obsolescence.

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Micaela

7 months ago

I think the answer is D) Shipping costs.

upvoted 0 times

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