Use the information below to answer the following question(s).Toronto Industries Inc.had the following activities during the year:

-Which of the following statements would be correct in a manufacturing business?
A)Completed goods are not normally included in the finished goods inventory.
B)Completed goods are part of the work in process category.
C)Work-in-process inventory, at the end of the accounting period, includes direct materials but not direct labour.
D)Materials put into production are classified as work-in-process inventory.
E)There can be no beginning finished goods inventory.

Question

Use the information below to answer the following question(s).Toronto Industries Inc.had the following activities during the year:
 
-Which of the following statements would be correct in a manufacturing business?
A)Completed goods are not normally included in the finished goods inventory. 
B)Completed goods are part of the work in process category. 
C)Work-in-process inventory, at the end of the accounting period, includes direct materials but not direct labour. 
D)Materials put into production are classified as work-in-process inventory. 
E)There can be no beginning finished goods inventory.

Quizplus · Accepted Answer

Materials put into production are classified as work-in-process inventory in a manufacturing business. Completed goods are included in the finished goods inventory, which is a separate category from work-in-process inventory. Work-in-process inventory includes both direct materials and direct labor at the end of the accounting period. It is possible to have a beginning finished goods inventory, as this is the inventory of completed goods carried over from the previous accounting period.

Use the Information Below to Answer the Following Question(s)