Match the Inventory-Related Accounts to Costs That May Be Included

question 220

Multiple Choice

Match the inventory-related accounts to costs that may be included in inventories for retailers and manufacturers.
-Costs of completed items that have been sold to customers.

• A)merchandise inventory
• B)raw materials
• C)work-in-process
• D)finished goods
• E)cost of goods sold

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Definitions:

Pegging

In material requirements planning systems, tracing upward in the bill of material from the component to the parent item.

Part Requirement

Specification or quantity of a component necessary for completing a manufacturing process or assembling a final product.

Parent Component

In manufacturing or software development, a main component that includes or is linked to subordinate components within a product or system.

Safety Stock

Inventory kept on hand as a buffer against variability in demand or supply, ensuring that out-of-stock situations are minimized.