Question

Goods a company acquires to use in making products are called:

Select one:
a. Cost of goods sold.
b. Raw materials inventory.
c. Finished goods inventory.
d. Work in Process inventory.
e. Conversion costs.

Answer 1

b. Raw materials inventory.

Step-by-step explanation:

There are basically three cycles to make a product ready to sale

1. Raw material

2. Work in process

3. Finished goods

The raw material is the part of the product. In the work in process, the products parts are in process to combine all the parts of the products. And, in the finished goods cycle, after processing the product, the product is finished and then the product is ready to sale.

The costs of goods sold and the conversion cost are the cost which are related to the product