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Work in Process Inventory
The inventory account that tracks the costs of materials, labor, and overhead for products that are in the process of being manufactured but are not yet completed.
Weighted-Average Method
An inventory costing method that averages the cost of inventory items to determine the cost of goods sold and ending inventory.
Process Costing System
A process costing system is used in manufacturing environments where the products are indistinguishable from each other and allocates the production costs based on the processes involved.
Conversion Costs
The sum of direct labor and overhead costs, which are incurred to convert raw materials into finished products.
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