Asked by Angie Rivera on Jul 04, 2024
Verified
On the balance sheet for a manufacturing business, the cost of direct materials, direct labor, and factory overhead are categorized as either materials inventory, work in process inventory, or finished goods inventory.
Balance Sheet
A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time.
Direct Materials
The raw materials that are directly traceable to the manufacturing of a product.
- Acquire knowledge on how inventory costs are classified and reported in manufacturing sectors.
Verified Answer
ZK
Zybrea KnightJul 05, 2024
Final Answer :
True
Explanation :
In a manufacturing business, the cost of direct materials, direct labor, and factory overhead are categorized as inventory under materials inventory, work in process inventory, or finished goods inventory. This is reflected on the balance sheet to provide a clear picture of the company's assets and liabilities.
Learning Objectives
- Acquire knowledge on how inventory costs are classified and reported in manufacturing sectors.
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