Which cost should reflect the incremental change in space cost due to changing cycle inventory?

A) Cost of capital
B) Obsolescence (spoilage) cost
C) Handling cost
D) Occupancy cost

Occupancy Cost

The total expense incurred for occupying a physical space, including rent, utilities, taxes, and maintenance.

Cycle Inventory

The portion of inventory that a business holds to meet its regular sales demand during a specific period.

Space Cost

Expenses related to the physical space required for operations, such as warehousing or retail locations.