Which of the following sequences describes the typical flow of costs in a company that is using process costing?
A)Raw Materials Inventory, Work in Process, Finished Goods, Cost of Goods Sold
B)Work in Process, Finished Goods, Raw Materials Inventory, Cost of Goods Sold
C)Raw Materials Inventory, Cost of Goods Sold, Work in Process, Finished Goods
D)Finished Goods, Raw Materials Inventory, Work in Process, Cost of Goods Sold

Question

Quizplus · Accepted Answer

The typical flow of costs in a company using process costing starts with Raw Materials Inventory, then moves to Work in Process, then to Finished Goods, and finally to Cost of Goods Sold. This sequence reflects the progression of materials as they are transformed into finished products and sold.

Which of the Following Sequences Describes the Typical Flow of Costs