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      Question

      Which of the following categories of inventory are

      generally reported by companies in their financial statements?
      A Raw materials, processed goods, and final goods Correct Answer Incorrect Answer
      B Raw materials, work-in-progress, and final goods Correct Answer Incorrect Answer
      C Purchased goods, work-in-progress, and finished goods Correct Answer Incorrect Answer
      D Raw materials, work-in-progress, and finished goods Correct Answer Incorrect Answer
      E Purchased goods, processed goods, and finished goods Correct Answer Incorrect Answer

      Solution

      As per accounting standards (e.g., Ind AS 2 – Inventories), companies typically classify and report inventory under three main categories: 1. Raw materials → Items consumed in the production process (including consumable stores). 2. Work-in-progress (WIP) → Goods that are partially completed and still undergoing production. 3. Finished goods → Goods fully manufactured or completed and held for sale in the ordinary course of business.

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