The Following Data Refer to Various Annual Costs Relating to the Inventory

question 31

Multiple Choice

The following data refer to various annual costs relating to the inventory of a single-product company that requires 10,000 units per year: What is the annual carrying cost per unit?

• A)$ .21
• B)$ .29
• C)$ .34
• D)$ .44

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Definitions:

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including materials and labor.

Estimated

An approximation or informed guess of a value, quantity, or outcome based on available data.

Budgeted Accounts Receivable

Predicts the amount of money owed to a business by its customers for sales made on credit during a specific period.

Collections

The process of gathering money that is owed by customers, often in relation to accounts receivable.