(Cost classification) For each of the following costs, indicate whether it would be considered an ordering cost...

Question:

(Cost classification) For each of the following costs, indicate whether it would be considered an ordering cost (O), a carrying cost (C), or a cost of not carrying (N) inventory. For any costs that do not fit these categories, indicate N/A. 1. Telephone call to supplier 2. Stationery and purchase order forms 3. Purchasing agent’s salary 4. Purchase price of product 5. Goodwill of customer lost due to unavailability of product 6. Postage on purchase order 7. Freight-in cost on product 8. Insurance on products on hand 9. Wages of receiving clerks 10. Preparing and issuing checks to suppliers 11. Contribution margin lost due to unavailability of product 12. Storage costs for products on hand 13. Quantity discounts on products ordered 14. Opportunity cost of funds invested in inventory 15. Property taxes on warehouses 16. Handling costs for products on hand 17. Excess ordering and shipping charges for rush orders of standard product lines 18. Spoilage of products awaiting use

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Financial Accounting

ISBN: 9780070891739

1st Canadian Edition

Authors: Robert Libby

Question Posted: