Question

Inventory not only makes up a portion or the cost of goods sold but has to be purchased at the beginning of production to be processed to
finished goods This type of inventory is called
A ) work in progress
B ) finished goods
C ) raw materials
D ) none of the above ​

Answer 1

$\mathfrak{\huge{\orange{\underline{\underline{Answer :}}}}}$

C) raw materials

Answer 2

Inventory not only makes up a portion of the cost of goods sold but has to be purchased at the beginning of production to be processed to finished goods. This type of inventory is called work in progress. (Option A)

• Inventory is classified into four types: raw materials/components, work in progress, completed items, and maintenance and repair activities.
• Work in progress inventory is inventory that not only accounts for a percentage of the cost of items sold but must be acquired at the start of the product to be turned into finished goods.
• WIP inventory relates to manufacturing elements such as raw materials or components, labor, overhead, and even packing materials.
• As a result, the inventory described in the question is a work-in-progress inventory.
• As a consequence, option A is right.