Inventory Consisting of the Basic Inputs to the Organisation's Production

question 64

Multiple Choice

Inventory consisting of the basic inputs to the organisation's production process is called __________ inventory.

• A) finished goods
• B) work-in-progress
• C) raw material
• D) possessed
• E) nonphysical

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Definitions:

First-In, First-Out Method

An accounting method for valuing inventory that assumes goods are sold in the order in which they are purchased or produced.

Equivalent Units

A concept in cost accounting used to allocate costs to partially completed goods, treated as if they were whole units.

Assembly Department

A section within a manufacturing facility where components are assembled together to create a finished product.

First-In, First-Out Method

An inventory valuation method in which the goods first purchased or produced are the first to be used or sold.