Question

Which of the following item of cost is not a part of inventory?

• A. Storage expenses
• B. Normal wastage
• C. Inward freight
• D. Custom duties

Answer 1

The correct option is A Storage expenses

The costs that are excluded from inventory include: abnormal costs that are incurred as a result of material waste, labor or other production conversion inputs, storage costs (unless required as part of the production process), and all administrative overhead and selling costs.

Hence, storage expenses are not a part of inventory.