Final answer:
Both U.S. GAAP and IFRS exclude selling costs (option d) from the cost of inventory. In the context of GDP, only the production of new goods and services, like hospital stays and new car sales, are included.
Step-by-step explanation:
The subject of the original question concerns accounting principles related to inventory costing under both U.S. Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS). Upon reviewing the accounting standards, both U.S. GAAP and IFRS exclude certain costs from the cost of inventory.
The correct option for the costs that are excluded by both U.S. GAAP and IFRS is d. Selling costs. This includes costs that are indirectly associated with the selling of products, like advertising and marketing expenses. Therefore, administrative and selling expenses, as well as most storage costs, are generally not allocated to inventory under these accounting frameworks.
Now, applying this knowledge to Gross Domestic Product (GDP) calculations, which reflect the total market value of all final goods and services produced over a specific time period within a country's borders, different rules apply. For example, the cost of hospital stays (a) and child care provided by a licensed day care center (c) are included in GDP calculations, as they reflect payment for services rendered.
On the other hand, the rise in life expectancy over time (b), and child care provided by a grandmother (d), do not have a market transaction associated with them and thus aren't included. A used car sale (e) does not contribute to GDP because it's not the production of a new good or service, while a new car sale (f) is included.
The greater variety of cheese available in supermarkets (g) is not a measure of production and hence not included, whereas the iron that goes into steel that goes into a refrigerator bought by a consumer (h) represents investment in inventory and is part of the GDP.