Accounting for IGCSE & O level - Final Statements (Section 14 - No. 32)
Which of the following statements is true regarding carriage inwards?
It is an operating expense.
It increases the cost of purchases.
It reduces the cost of purchases.
It decreases gross profit, then increases net profit.
Explanation
Carriage inwards is the cost of bringing goods to the business, and it is added to the cost of purchases.
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