D is corrent. The uniform capitalization rules generally require that all costs incurred in acquiring property for resale must be capitalized as part of the cost of inventory. The costs that must be capitalized include the costs of purchasing, handling, processing, repackaging and assembly, as well as the costs of off-site storage. An off-site storage facility is one that is not physically attached to, nor an integral part of, a retail sales facility.
A is incorrect because both repacking cost and off-site storage cost must be capitalized with respect to inventory.
B is incorrect because both repacking cost and off-site storage cost must be capitalized with respect to inventory.
B is incorrect because both repacking cost and off-site storage cost must be capitalized with respect to inventory.
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