The Ramien Store Held Inventory Items at the End of 2014.Which

question 2

Multiple Choice

The Ramien Store held inventory items at the end of 2014.Which items should Ramien include as part of its total inventory cost?

• A)Freight incurred in shipping goods to customers.
• B)Annual income taxes paid for operations.
• C)Cost of storing inventory before it is sold.
• D)Cost of salaries of clerks that sell the inventory items.

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Definitions:

Forward Contract

A financial derivative that represents a customized contract between two parties to buy or sell an asset at a specified price on a future date.

Carrying Value

The book value of assets and liabilities, reflecting their recorded cost minus any depreciation, amortization, or impairment charges.

Spot Rate

The price at which a financial instrument or commodity can be bought or sold for immediate delivery, emphasizing current market value.

Fair Value Hedge

A hedge that protects against changes in the fair value of assets, liabilities, or unrecognized firm commitments.