Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

4. Merchandising Operations

Cost of Goods Sold - Perpetual Inventory vs. Periodic Inventory

Financial Accounting

4. Merchandising Operations

Cost of Goods Sold - Perpetual Inventory vs. Periodic Inventory

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Multiple Choice

Which of the following items are included in raw materials inventory under a manufacturing company's accounting system?

Work in process inventory

Finished goods ready for sale

Indirect materials that have not yet been issued to production

Direct materials purchased but not yet used in production

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Verified step by step guidance

Understand the concept of raw materials inventory: In a manufacturing company's accounting system, raw materials inventory includes materials that are purchased but not yet used in production. These can be direct materials (used directly in the production of goods) or indirect materials (used to support production but not directly part of the finished product).

Differentiate between raw materials, work in process, and finished goods: Work in process inventory refers to goods that are partially completed, while finished goods inventory includes products that are fully completed and ready for sale. These are separate categories and not part of raw materials inventory.

Identify direct materials: Direct materials are those that are directly used in the production of goods, such as wood for furniture or fabric for clothing. If these materials are purchased but not yet used in production, they are included in raw materials inventory.

Identify indirect materials: Indirect materials are those that support the production process but are not directly part of the finished product, such as lubricants or cleaning supplies. If these materials have not yet been issued to production, they are included in raw materials inventory.

Exclude work in process and finished goods: Since the problem specifies raw materials inventory, exclude items that fall under work in process inventory or finished goods inventory, as these are separate categories in a manufacturing company's accounting system.