The Cost of Acquiring Inventory Includes

question 82

Multiple Choice

The cost of acquiring inventory includes

• A)setup costs for goods produced internally.
• B)cost of insurance on the warehouse for inventory.
• C)cost of not having a product when a customer wants one.
• D)cost of obsolescence.

---

Definitions:

Debit Balances

The situation where the total debits in an account exceed the total credits, indicating assets or expenses.

Credit Balances

Balances in financial accounts indicating the amount owed by the account holder, often seen in liability and equity accounts.

Salaries Expense

The total amount paid to employees for services rendered during a specific period, recognized in the accounting period in which the employees performed the services.

Posting Reference

An identifier or code that links journal entries to the relevant accounts in the general ledger, facilitating tracking and auditing.