Which of the Following Would Not Be Included in Inventory

question 42

Multiple Choice

Which of the following would not be included in inventory carrying cost?

• A) Insurance expense for the inventory
• B) Opportunity cost of capital for inventory investment
• C) Cost of inventory
• D) Cost of shelf space

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Definitions:

Accounting Profit

The net income a company reports on its financial statements, calculated as total revenues minus explicit costs.

Marginal Product

The additional output that is produced by using one more unit of a specific input, holding the levels of all other inputs constant.

Nonlabor Resources

Nonlabor resources refer to the materials, capital, land, and technology used in the production of goods and services, distinct from human labor.

Output

The total amount of goods or services produced by a business, industry, or economy during a given period.