Which of the Following Costs Will Not Affect Cost of Goods

question 83

Multiple Choice

Which of the following costs will not affect cost of goods sold?

• A)Inventory inspection costs.
• B)Inventory preparation costs.
• C)Inventory related selling costs.
• D)Freight charges incurred to acquire inventory.

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Definitions:

Straight-line

A method of depreciation that allocates an equal expense rate to each year of an asset’s useful life.

Accelerated Methods

Depreciation methods that allocate more depreciation expense to the earlier years of an asset's life.

Depreciation

Strategically spreading out the cost of a tangible asset throughout its period of usefulness.

Accounting Estimate

An approximation of a financial transaction's value when precise measurement is not possible, often used in accrual accounting.