The insurance premium should be included in the inventory costs while the advanced commissions should not be added in inventory costs.
Within an organization or frim, for keeping the records of all the transactions and the revenue, an inventory cost is maintained by the firm. The inventory is the place within the firm where all the goods are kept which are ready to be shipped from the company. The inventory cost includes all the expenses incurred while transporting any goods but the advanced payments are not included in the inventory cost. So, the in transit insurance premium paid by the Southgate Co. will be counted in the inventory cost while the advance payment done by the Southgate co. will not be considered in the inventory cost.
Learn more about Inventory cost at:
brainly.com/question/28505351
#SPJ4
