All of Tysons (TSN) costs related to raising chickens for sale are accounted for as inventory. Thus,

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All of Tyson’s (TSN) costs related to raising chickens for sale are accounted for as inventory. Thus, the transportation, boarding, and feed costs are included in the cost of chicken inventory.
Other costs that should be included as part of chicken inventory include the labor costs of raising the chickens held for sale. In addition, depreciation on the farm buildings and equipment should be allocated to chicken inventory.
The breeding stock is not held for sale, but instead is an operating asset used in the production of chickens. In other words, the breeding stock is a fixed asset. As with any fixed asset, the cost is depreciated over its useful life. Theoretically, this depreciation should be allocated to the costs of raising the chickens for sale and, thus, is also an inventory cost.

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Financial And Managerial Accounting

ISBN: 9780357714041

16th Edition

Authors: Carl S. Warren, Jefferson P. Jones, William Tayler

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