When manufacturing products, which of the following is an example of an inventoriable cost?
A) Depreciation on office equipment
B) Depreciation on store building
C) Depreciation on factory equipment
D) Sales salaries expenses

Question

Quizplus · Accepted Answer

Depreciation on factory equipment is an example of an inventoriable cost as it is a cost associated with the production of goods and is included in the cost of inventory until the product is sold. Depreciation on office equipment and sales salaries expenses are not directly related to production and are expensed in the period incurred. Depreciation on the store building is a mixed cost that includes both selling expenses and inventoriable costs, therefore it cannot be solely classified as an inventoriable cost.

When Manufacturing Products, Which of the Following Is an Example