Final answer:
The income statement for merchandisers lists purchases and for manufacturers includes costs of raw materials, work in progress, and finished goods. The merchandise balance of trade reflects the difference between exports and imports, with a trade deficit indicated by a negative merchandise balance and impacting the current account balance.
Step-by-step explanation:
The question inquires about the difference between the income statements of a merchandiser and a manufacturer. To clarify, a merchandiser's income statement will typically show the cost of goods sold directly as it purchases finished goods for resale. A manufacturer, on the other hand, will have detailed sections that show the cost of raw materials, work in progress, and finished goods, as they convert raw materials into finished products. Both types of entities will list their operating expenses, but manufacturers may have additional costs related to production, such as direct labor and manufacturing overhead. The question also mentions the merchandise balance of trade, which represents the difference between exports and imports of goods. When there are more imports than exports, as in this case ($1,046 - $1,562), there is a trade deficit, which is -$516 billion for the merchandise trade and affects the current account balance, here listed as -$419 billion.