Question

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

Answer 1

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.

Answer 2

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.