Which of the following are examples of inventory holding costs?
i. Inwards inspection
ii. Rental
iii. Opportunity cost
iv. Insurance

A) i, ii and iii
B) ii, iii and iv
C) i, ii and iv
D) i, iii and iv

Question

Which of the following are examples of inventory holding costs?i. Inwards inspectionii. Rentaliii. Opportunity costiv. InsuranceA)  i, ii and iiiB)  ii, iii and ivC)  i, ii and ivD)  i, iii and iv

Ammon Fleming · Accepted Answer

Final Answer : B, Explanation :  - Rental is a clear example of inventory holding cost as it is incurred to hold the inventory in a specific location or facility.- Opportunity cost is also an inventory holding cost as it refers to the cost of not being able to use the capital tied up in inventory for other opportunities.- Insurance is a common cost associated with inventory as it is required to protect against loss or damage of inventory. Inwards inspection is not typically considered a direct inventory holding cost as it is a quality control measure to ensure the incoming inventory is of acceptable quality.

Which of the following are examples of inventory holding costs?
i. Inwards inspection
ii. Rental
iii. Opportunity cost
iv. Insurance

A) i, ii and iii
B) ii, iii and iv
C) i, ii and iv
D) i, iii and iv

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