Select the response that best illustrates the point that product cost flows are cyclical and occur in a specific sequence.
A) Acquire raw materials, convert raw materials, sell finished goods, collect cash
B) Acquire finished goods, acquire raw materials, convert raw materials, collect cash
C) Sell finished goods, collect cash, acquire raw materials
D) Collect cash, acquire raw materials, sell finished goods

Question

Quizplus · Accepted Answer

The correct sequence for product cost flows is to acquire raw materials, convert them into finished goods, sell those goods, and finally collect cash. This sequence is cyclical and continuous as it starts over again with acquiring raw materials. Option A is the only option that correctly follows this sequence.

Select the Response That Best Illustrates the Point That Product