Saturday, June 27, 2020

How to define finished goods?

According to Wikipedia: Finished goods are goods that have completed the manufacturing process but have not yet been sold or distributed to the end user. Finished goods are non-phantoms and are stored in the warehouse before they are shipped.

Finished goods inventory is the stock of completed products. These goods have been inspected and have passed final inspection requirements so that they can be transferred out of work-in-process and into finished goods inventory. From this point, finished goods can be sold directly to their final user, sold to retailers, sold to wholesalers, sent to distribution centres, or held in anticipation of a customer order.

The purpose of finished goods inventory is to uncouple the production and sale functions so that it is no longer necessary to produce the goods before a sale can occur. Inventory management has to do with keeping precise records of finished goods that are ready for shipment.

Accurately maintaining figures on the finished goods inventory makes it possible to quickly convey information to sales personnel as to what is available and ready for shipment at any given time.
How to define finished goods?

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