Question

Which of the following statements are true? Multiple select question. Raw materials inventory only includes the cost of direct materials. Raw materials inventory represents the cost of materials not yet used in production. When materials are purchased they are recorded in the Raw materials inventory account. Direct labor costs flow through the Raw materials inventory account.

Answer 1

The true statements are:

• Raw materials inventory represents the cost of materials not yet used in production.
• When materials are purchased they are recorded in the Raw materials inventory account.

What are Raw materials?

Raw Materials are unprocessed materials used in the production of certain finished products.

In business accounting;

• The raw materials inventory is recorded as the cost of materials that are yet to be used in production.
• The materials purchased are usually recorded in the raw materials inventory account.

Learn more about raw materials here:

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