For a manufacturing company,direct material costs may be included in ________.
A) direct materials inventory only
B) merchandise inventory only
C) both work-in-process inventory and finished goods inventory
D) direct materials inventory, work-in-process inventory, and finished goods inventory accounts

Question

Quizplus · Accepted Answer

Direct material costs are included in the direct materials inventory when they have been purchased but not yet used in production, in the work-in-process inventory when they are being used in production, and in the finished goods inventory when they have been used in production and are ready for sale. Therefore, direct material costs may be included in all three inventory accounts: direct materials inventory, work-in-process inventory, and finished goods inventory accounts.

For a Manufacturing Company,direct Material Costs May Be Included in ________