Based on the matching principle,all product costs end up in
A)Raw materials Inventory.
B)Work in Process.
C)Finished Goods.
D)Cost of Goods Sold.

Question

Quizplus · Accepted Answer

The matching principle requires that product costs, including direct materials, direct labor, and manufacturing overhead, be matched with the revenue they generate. This means that these costs should be recorded as an expense in the same period that the associated revenue is recognized. Therefore, all product costs should ultimately be included in Cost of Goods Sold, which is the expense account used to record the cost of producing and selling goods. While product costs are initially recorded in Raw Materials Inventory, Work in Process, and Finished Goods accounts, they are transferred to Cost of Goods Sold when the products are sold.

Based on the Matching Principle,all Product Costs End Up in