Practicing Success

Target Exam

CUET

Subject

Entrepreneurship

Chapter

Business Arithmetic

Question:
Which of the following is correct about Carrying Cost?
Options:
Carrying cost refers to the estimated amount of bad debts.
Carrying cost refers to the total cost of holding inventory.
Carrying cost refers to the estimated amount of costs for transportation.
Carrying cost refers to the estimated amount of costs for transportation and labour for loading and unloading raw materials and finished products.
Correct Answer:
Carrying cost refers to the total cost of holding inventory.
Explanation:
Carrying cost: In marketing, carrying cost refers to the total cost of holding inventory. This includes warehousing costs such as rent, utilities and salaries, financial costs such as opportunity cost, and inventory costs related to perishability, pilferage, shrinkage and insurance.