Question

Nonmanufacturing costs are ______. Multiple choice question. always reported as inventory only reported as inventory under variable costing never reported as inventory only reported as inventory under full absorption costing

Answer 1

Answer:

never reported as inventory

Explanation:

Nonmanufacturing costs are never reported as inventory. This is because they are not tangible items that need to be stored, also these costs do not have anything to do with the production of the end product and are not resources to the production process. Instead, these costs revolve around everything not related to the product creation such as company personnel or shipping/storage costs. Therefore, it is never reported to inventory which is for products and resources.