Question

For a​ manufacturer, the budgeted income​ statement________. A. includes amounts from the​ sales, cost of goods​ sold, cash, and capital expenditures budgets B. reports cash paid for purchases of direct materials C. does not include depreciation expense D. is​ accrual-based

Answer 1

B. reports cash paid for purchases of direct materials

Step-by-step explanation:

There is the only difference of direct material reporting in reporting of a manufacturing business and service based business. A Merchandiser only reports the cost of goods sold which includes the price of the product and other expenses associated with it. A service provider reports the cost of supplies in place of cost of goods sold. The manufacturer reports the direct material, direct labor and all overheads used in the production of the product.