ECONOMICS

Detailed explanation-1: -Ordering costs are the expenses your company incurs to purchase and receive the products it stocks in its inventory. These ordering costs can include shipping fees, unexpected transportation costs, inspection fees and other expenses necessary to acquire inventory products.

Detailed explanation-2: -Inventory carrying cost is the cost the sum of expenses for handling or storing any unsold goods. These costs incorporate warehousing, labor, insurance, rent, combined with the value of damaged, expired, or out-of-date products.

Detailed explanation-3: -The cost of inventory includes the cost of purchased merchandise, less discounts that are taken, plus any duties and transportation costs paid by the purchaser.

Detailed explanation-4: -Ordering, holding, carrying, shortage and spoilage costs make up some of the main categories of inventory-related costs.