156k views
0 votes
Finished goods inventory is reported on the a.balance sheet as a long-term asset b.balance sheet as a current asset c.income statement as revenue d.income statement as a period cost g

User Nmuntz
by
7.5k points

2 Answers

2 votes

Answer:

The correct answer is letter "B": balance sheet as a current asset.

Step-by-step explanation:

Finished goods inventory includes all those goods that do not need any more manufacturing or goods that were purchased already finished -merchandise- but have not been sold yet. Finished goods on the Balance Sheet are considered current assets because it is expected they will be sold in less than 1 year.

User Volkersfreunde
by
8.9k points
0 votes

Answer:

The answer is B. balance sheet as a current asset

Step-by-step explanation:

Finished goods inventory is a current asset and assets are reported under balance sheet.

Current asset like finished goods inventory is an inventory that will or should be sold within a year.

Inventory is not a non-current asset. Non-current asset has more than a year as life span e.g machinery, equipment etc.

Option C and D are wrong because inventories are neva reported on income statement.

User Daniel Goldfarb
by
8.0k points

No related questions found

Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.