Certified Supply Chain Professional (CSCP) Practice Exam

What does finished goods inventory refer to?

1. Raw materials awaiting processing

2. Products that have not yet been sold

3. Goods that are waiting to be purchased

4. Defective products needing repair

The correct answer is: Goods that are waiting to be purchased

Finished goods inventory refers specifically to products that have been completed through the manufacturing process and are ready for sale. This inventory includes all items that are fully manufactured, packaged, and stored, awaiting purchase by customers. Products that have not yet been sold can often still be considered finished goods. However, the term "finished goods inventory" directly implies that they are not raw materials (which would not yet be processed) and do not include defective products needing repair (which indicates they are not ready for sale). Therefore, the choice that highlights goods waiting to be purchased accurately captures the essence of what finished goods inventory entails, emphasizing their complete status and readiness for the market.