Question

 Which of the following is not the part of inventory cost as per AS – 2? 

(A) Storage Costs that are necessary in the production process prior to a further production stage. 

(B) Administrative Overheads that contribute to bringing the inventories to their present location and condition. 

(C) Normal loss. 

(D) Storage costs that are not necessary in the production process prior to a further production stage.

Answer 1

Storage costs that are not necessary in the production process prior to a further production stage is not the part of inventory cost as per AS – 2.