In managing inventory,what are the costs that result when a company holds an inventory of goods for sale,known as?
Variant question
A)Interest costs
B)Opportunity costs
C)Purchasing costs
D)Carrying costs

Question

Quizplus · Accepted Answer

The costs that result when a company holds an inventory of goods for sale are known as carrying costs. These costs include expenses such as storage, insurance, handling, obsolescence, and deterioration, among others. The longer a company holds inventory, the higher its carrying costs will be. Therefore, it is important for companies to manage their inventory levels efficiently to minimize these costs. The other options are not directly associated with inventory holding costs. Interest costs relate to the cost of borrowing, opportunity costs refer to the forgone alternative when a particular decision is made, and purchasing costs are the expenses associated with acquiring inventory.

In Managing Inventory,what Are the Costs That Result When a Company