An inventory which consists of stock waiting to be used In the process of manufacturing is known as ___________?
Correct answer: B. direct materials inventory
- A. finished goods inventory
- B. direct materials inventory
- C. indirect material inventory
- D. work in process inventory
Explanation
Direct materials inventory consists of raw materials held for use in manufacturing and traceable to the finished product. Work-in-process inventory has already entered production but is not yet complete.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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