Which of the following items is not relevant to the cost flows of a service organization?
A)finished goods inventory
B)materials inventory
C)work-in-process inventory
D)direct labour

Question

Quizplus · Accepted Answer

Finished goods inventory is not relevant to the cost flows of a service organization as they do not produce any physical products. Service organizations mainly deal with providing intangible services, which do not require inventory management like manufacturing companies. The other options, materials inventory, work-in-process inventory, and direct labor, are relevant to the cost flows of a service organization.

Which of the Following Items Is Not Relevant to the Cost