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Other costs, such as transportation and even storage of the inventory, are also considered to be inventoriable. For a manufacturing operation, determining the cost of inventory on hand will begin with the actual unit cost of every item that is maintained within an inventory.
If the company has a beginning inventory, it is included both in the total units available and in the total cost of goods available in computing the average cost per unit. Another average cost method is moving average method, which is used with perpetual inventory records.