A company incurs the followings costs related to its inventory during the year:
| Cost | ¥ millions |
| Purchase price | 100,000 |
| Trade discounts | 5,000 |
| Import duties | 20,000 |
| Shipping of raw materials to manufacturing facility | 10,000 |
| Manufacturing conversion costs | 50,000 |
| Abnormal costs as a result of waste material | 8,000 |
| Storage cost prior to shipping to customers | 2,000 |
The amount charged to inventory cost (in millions) is closest to:
The costs to include in inventories are all costs of purchase, costs of conversion, and other costs incurred in bringing the inventories to their present location and condition.
| Cost | ¥ millions |
| Purchase price | 100,000 |
| Less Trade discounts | (5,000) |
| Import duties | 20,000 |
| Shipping of raw materials to manufacturing facility | 10,000 |
| Manufacturing conversion costs | 50,000 |
| Total inventory costs | 175,000 |