Inventory is recorded at cost when purchased.The cost of the inventory is
A)the purchase price
B)the purchase price less any purchase discounts
C)all expenditures necessary to obtain the inventory
D)the purchase price less any discounts plus any financing charges

Question

Quizplus · Accepted Answer

According to Generally Accepted Accounting Principles (GAAP), inventory should be recorded at cost, which includes all expenditures necessary to obtain the inventory. This includes purchase price, transportation charges, customs duties, and any other costs directly incurred to get the inventory to its present location and condition. Purchase discounts and financing charges should not be included in the cost of inventory.

Inventory Is Recorded at Cost When Purchased