Which three statements describe true characteristics of a "profit in inventory" cost element?

The statement highlighting that "profit in inventory" can help understand true margins and value added by internal business units through the internal supply chain is accurate because this concept focuses on the internal transaction processes within an organization. By accounting for internal profits embedded within inventory, organizations can gain insights into how various departments contribute to overall profitability and where value is added throughout the supply chain. This aspect is critical for managerial analysis, as it facilitates better strategic decision-making regarding pricing, product costing, and inventory management.

Additionally, the features and functions of profit in inventory usually revolve around how internal transactions lead to value generation, which is important for assessing overall business performance and ensuring that internal practices align with broader financial goals. Understanding these dynamics can assist in optimizing operations and improving coordination among units.

In the context of other choices, the focus of "profit in inventory" is not limited to instances where there is no need for an arm's length relationship or applicable to external suppliers alone. These statements do not encompass the full scope and purpose of monitoring internal costs through profit in inventory, which reinforces its primary goal of enhancing internal financial visibility and accountability.