Question

Which of the following costs are included in merchandise inventory?

a) Shipping costs
b) Advertising costs
c) Purchase discounts
d) Storage costs

Answer 1

Purchase discounts and storage costs are included in merchandise inventory, while shipping costs and advertising costs are not included.

Step-by-step explanation:

The costs that are included in merchandise inventory are purchase discounts and storage costs. Shipping costs and advertising costs are not included in merchandise inventory.

Shipping costs are considered as a separate expense related to transporting the inventory, while advertising costs are considered as a separate expense related to marketing and promoting the inventory.