ECONOMICS

Detailed explanation-1: -Work in process (WIP) inventory refers to materials that are waiting to be assembled and sold. WIP inventory includes the cost of raw materials, labor, and overhead costs needed to manufacture a finished product.

Detailed explanation-2: -Raw materials inventory refers to the materials that are used to create a business’s finished goods. While raw material inventory is not sold to end customers as-is, a company keeps raw materials in stock so that they can turn them into work-in-process (or WIP) inventory or finished goods inventory.

Detailed explanation-3: -Inventory is a current asset account found on the balance sheet, consisting of all raw materials, work-in-progress, and finished goods that a company has accumulated. Ending inventory may be calculated using the FIFO method, the LIFO method, specific identification, and the weighted average method.

Detailed explanation-4: -Inventory refers to a company’s goods and products that are ready to sell, along with the raw materials that are used to produce them. Inventory can be categorized in three different ways, including raw materials, work-in-progress, and finished goods.