Transferred-in costs are treated as if they are ________.
A) conversion costs added at the beginning of the process
B) costs of beginning inventory added at the beginning of the process
C) direct labor costs added at the beginning of the process
D) a separate direct material added at the beginning of the process

Question

Quizplus · Accepted Answer

Transferred-in costs are costs incurred in a previous department that are carried forward as the product's cost when it moves to a subsequent process in the production cycle. They are treated as if they are a separate direct material added at the beginning of the process in the receiving department. This is because these costs are already incurred and are part of the product's total cost as it continues through the production process.

Transferred-In Costs Are Treated as If They Are ________