The audit of cost accounting begins with the internal transfer of assets from raw materials to work-in-process to
A) manufacturing overhead.
B) finished goods inventory.
C) the perpetual inventory master files.
D) retail sales.

Question

Quizplus · Accepted Answer

The internal transfer of assets from raw materials to work-in-process to finished goods inventory is a typical flow in cost accounting. Therefore, the audit of cost accounting should end with the finished goods inventory since it is the final product of the manufacturing process.

The Audit of Cost Accounting Begins with the Internal Transfer