Question

From a marginal analysis perspective, what is the inventory carry cost for Andrews if the company carries one additional unit of Able in inventory at the end?

Select: 1
$1.92
$3.85
$9.98
$1.20

Answer 1

Carrying cost or carrying cost of inventory is a term used in marketing that refers to holding inventory and the entire cost associated with doing so. The warehouse costs to hold the inventory, all costs associated with the items being held that range from salaries for employees, rent, opportunity costs for not selling the items are all considered when talking about carrying costs of holding inventory.

Answer 2

Andrew's company will have an inventory carry cost of $1.20 if it carries one additional unit of Able in inventory at the end. This is assuming that the company's previous inventory is lower than the current one. This means that a difference or variance in the inventory is found to be $1.20.