BM1 – Chapter 6 Review
| A | B |
|---|---|
| Which business structure contains both the benefits of a small business and a corporation? | franchise |
| Which type of business makes a finished product, such as an automobile? | manufacturer |
| How does a product get from a manufacturer to a wholesaler? | by an intermediary |
Which kind of entrepreneur converts raw material to finished product?
Industries engaged in the conversion of raw materials or semi-finished products into finished products are called manufacturing industries.
What is the product that is made from raw material called?
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.
What is raw materials in business?
Raw materials are materials or substances used in the primary production or manufacturing of goods. Traders buy and sell raw materials in what is called the factor market because raw materials are factors of production as are labor and capital.
What is a finished good or service?
When the good is completed as to manufacturing but not yet sold or distributed to the end-user, it is called a “finished good”. This is the last stage for the processing of goods. The goods are ready to be consumed or distributed. There is no processing required in term of the goods after this stage by the seller.
Is the cost of converting raw material into finished good?
Prime costs are defined as the expenditures directly related to creating finished products, while conversion costs are the expenses incurred when turning raw materials into a product.
How are raw materials different from finished goods?
Inventory is classified as falling within three general categories: raw materials, work in progress, and finished goods. Raw materials are the primary components a business uses to make products. In the most primary stage, raw materials are extracted from minerals or produced from natural or chemically created substances.
How are raw materials used in a business?
Raw materials are the primary components a business uses to make products. In the most primary stage, raw materials are extracted from minerals or produced from natural or chemically created substances. Those materials are then refined and used to make products for customers.
How are raw materials tracked in the manufacturing process?
Fortunately, businesses can track each of these costs and inefficiencies through their manufacturing processes. Businesses can categorize materials as they move through the process, from being raw materials to works-in-progress, and finally a finished products.
What is the definition of raw materials inventory?
1. Raw Materials Inventory. Raw materials inventory involve items used to make finished products. Raw materials can be commodities or components that businesses buy or extract themselves. In sum, they’re all the stock that hasn’t been used for manufacturing yet.
