Which Statement Below Best Describes How to Account for the Costs

question 232

Multiple Choice

Which statement below best describes how to account for the costs of purchasing inventory?

• A)The costs are initially recorded as expenses and depreciated over the estimated useful life.
• B)Inventory costs are initially reported as assets and then maintained in the asset accounts for the life of the business.
• C)The costs are initially recorded as assets and become expenses when the inventory has an increase in market value.
• D)The costs are initially recorded as assets and become expenses when the inventory is sold.

---

Definitions:

Salty Soil

Soil that contains a high level of soluble salts, often making it unproductive for agriculture due to its effect on the osmotic balance of plants.

Agricultural Experts

Professionals specializing in the science and practice of farming, including cultivation of the soil for the growing of crops and the rearing of animals to provide food, wool, and other products.

Over Nutrition

A form of malnutrition where the intake of nutrients is oversupplied, leading to health issues such as obesity and related diseases.

Energy Intake

The amount of energy or calories consumed by an organism through food and drink; a crucial factor in nutrition and health.