Question

Ford Company has two process departmens, cutting and shaping, that produce products. At what point can direct materials be added to product costs? a. At the point the materials are used in production during either the cutting or shaping Departments. b. At the point the products are completed and transferred to Finished Goods. c. At the point the materials are acquired from the supplier. d. At the point production begins in the cutting department.

Answer 1

Answer:

a. At the point the materials are used in production during either the cutting or shaping Departments.

Explanation:

Materials will be added in the first process always as without materials there is no product.

Then, it may move to another department when there is no use of direct material or some additional materials could be used.

The accounting should represent reality and if a subsequent process required the input of materials should be accounted on that moment.