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Question 1: What is the difference between the Consumed and Finished Item methods for charging productioncosts to a project?
A.The consumed method will post item transactions to the project as the production order is ended, while
the Finished Item method will not post any transactions to the project until the project is invoiced.
B.The consumed method will post hour, expense and item transactions to the project as they are
consumed on the production order, while the Finished Item method will post item transactions to the
project as the production order is report as finished.
C.The consumed method will only post raw material consumption costs to the project as they are
consumed on the production order, while the Finished Item method will post the labor and machine costs
to the project in addition to the raw material consumption cost.
D.There is no difference between the two methods in how they charge production costs. The two methods
determine how the production order will be scheduled.
Correct Answer: b
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