MANAGEMENT

Detailed explanation-1: -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.

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: -Raw materials are the input goods or inventory that a company needs to manufacture its products. Examples of raw materials include steel, oil, corn, grain, gasoline, lumber, forest resources, plastic, natural gas, coal, and minerals.

Detailed explanation-4: -“A raw material, also known as a feedstock, unprocessed material, or primary commodity, is a basic material that is used to produce goods, finished products, energy, or intermediate materials that are feedstock for future finished products.”

Detailed explanation-5: -#1 – Raw Material Inventory: Raw materials are the basic materials that a manufacturing company buys from its suppliers. The former uses them to convert them into the final products by applying manufacturing processes.