Which of the Following Is True of Finished Goods Inventory

question 8

Multiple Choice

Which of the following is true of finished goods inventory?

• A)Finished Goods Inventory is an account used by a manufacturer and includes completed goods that have not yet been sold.
• B)Finished Goods Inventory is an account used by a merchandiser and includes completed goods that have not yet been sold.
• C)Finished Goods Inventory is an account used by service companies in lieu of raw materials inventory.
• D)Finished Goods Inventory is an account used by a manufacturer in lieu of raw materials inventory.

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Definitions:

Overhead Cost Per Unit

The allocation of total fixed and variable manufacturing overhead costs to individual units of product.

Product F

A specific item or good produced by a company, referred to as "Product F" for identification or category purposes.

Activity Rates

These are the costs assigned to work based on the activities required to complete a job or task.

Batches

Groups of items or goods processed or produced together within a specified time frame in manufacturing or production.