Classifi cation of Inventory Costs Put an X in the appropriate column next to the inventory item to indicate its most likely classifi cation on the books of a company that manufactures furniture and then sells it in retail company stores.

Classifi cation Raw Work in Finished Merchandise Inventory Item Material Process Goods Inventory Fabric Lumber Unvarnished tables Chairs on the showroom fl oor Cushions Decorative knobs Drawers Sofa frames Chairs in the plant warehouse Chairs in the retail storeroom.

AppendixLO1