It is an asset account which includes include items held for sale in the ordinary

course of business (finished goods), assets in the production process for sale in
the ordinary course of business (work in process), and materials and supplies that
are consumed in production (raw materials). 
(2 Points)

2.What are the components (3) of an inventory cost?

(2 Points)

3.Under this inventory system, the inventory account is not updated when
purchases of merchandise are made from suppliers, instead, it is commonly
updated or adjusted only once which is usually at the end of the year. 
(2 Points)

4.Under this inventory system, the inventory account is continuously updated. 

(2 Points)

5.An Inventory Cost flow method where the most recently produced items are
recorded as sold first. 
(2 Points)

6.An Inventory Cost flow method where the first produced items are recorded as
sold first.
(2 Points)

7.An Inventory Cost flow method where which the cost of item each item in an
inventory in calculated on the basis of the average cost of all similar goods in the
inventory. 
(2 Points)

8.This method takes the average cost of all the goods in stock, regardless of the
purchase date, which are then reported as cost of goods sold in the income
statement
(2 Points)

9.This method re-calculates the average cost of inventory after every inventory
purchase
(2 Points)

10.This method is when the Average Cost Method is combined with the Perpetual
Inventory System.