Inventory Items on an Assembly Line in Various Stages of Production

question 59

Multiple Choice

Inventory items on an assembly line in various stages of production are classified as

• A) Finished goods.
• B) Work in process.
• C) Raw materials.
• D) Merchandise inventory.

---

Definitions:

Mature Production Process

Indicates a manufacturing or production process that has reached a stage of optimization and efficiency through experience and adaptation.

Standard Costing System

An accounting system that assigns fixed costs to products based on standard assumptions about the production process.

Variance Accounts

Accounts used in managerial accounting to record the differences between actual costs and standard (budgeted) costs.

Direct Material Price Variance

The difference between the actual cost of direct materials and the standard cost multiplied by the actual quantity used.