Identify the correct statement with respect to manufacturing and merchandising companies in general and how their accounting systems differ. A. Merchandising companies transform materials into other goods through the use of labor and factory facilities. Manufacturing companies sell goods without changing their basic forms. Manufacturing companies show inventories at the cost they pay to acquire them. Merchandising companies classify production costs as either direct material, direct labor, or indirect production costs, and they use the accounting system to determine how much cost of each type should be assigned to product inventories. B. Manufacturing is the transformation of materials into other goods through the use of labor and factory facilities. Merchandising is the transformation of materials into other goods using outside vendors. Both companies classify production costs as either direct material, direct labor, or indirect production costs, and they use the accounting system to determine how much cost of each type should be assigned to product inventories. C. Manufacturing is the sale of goods purchased at wholesale prices. Merchandising is the production of goods using raw materials purchased at resale prices. Both companies show inventories at the cost they pay to acquire them. D. Manufacturing is the transformation of materials into other goods through the use of labor and factory facilities. Merchandising companies sell goods without changing their basic forms. Merchandising companies show inventories at the cost they pay to acquire them. Manufacturing companies classify production costs as either direct material, direct labor, or indirect production costs, and they use the accounting system to determine how much cost of each type should be assigned to product inventories.
Identify the correct statement with respect to manufacturing and merchandising companies in general and how their accounting systems differ. A. Merchandising companies transform materials into other goods through the use of labor and factory facilities. Manufacturing companies sell goods without changing their basic forms. Manufacturing companies show inventories at the cost they pay to acquire them. Merchandising companies classify production costs as either direct material, direct labor, or indirect production costs, and they use the accounting system to determine how much cost of each type should be assigned to product inventories. B. Manufacturing is the transformation of materials into other goods through the use of labor and factory facilities. Merchandising is the transformation of materials into other goods using outside vendors. Both companies classify production costs as either direct material, direct labor, or indirect production costs, and they use the accounting system to determine how much cost of each type should be assigned to product inventories. C. Manufacturing is the sale of goods purchased at wholesale prices. Merchandising is the production of goods using raw materials purchased at resale prices. Both companies show inventories at the cost they pay to acquire them. D. Manufacturing is the transformation of materials into other goods through the use of labor and factory facilities. Merchandising companies sell goods without changing their basic forms. Merchandising companies show inventories at the cost they pay to acquire them. Manufacturing companies classify production costs as either direct material, direct labor, or indirect production costs, and they use the accounting system to determine how much cost of each type should be assigned to product inventories.
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter1: Introduction To Managerial Accounting
Section: Chapter Questions
Problem 5E: From the choices presented in parentheses, choose the appropriate term for completing each of the...
Related questions
Question
Transcribed Image Text:Identify the correct statement with respect to manufacturing and merchandising companies in
general and how their accounting systems differ.
A. Merchandising companies transform materials into other goods through the use of labor and
factory facilities. Manufacturing companies sell goods without changing their basic forms.
Manufacturing companies show inventories at the cost they pay to acquire them. Merchandising
companies classify production costs as either direct material, direct labor, or indirect production
costs, and they use the accounting system to determine how much cost of each type should be
assigned to product inventories.
B. Manufacturing is the transformation of materials into other goods through the use of labor and
factory facilities. Merchandising is the transformation of materials into other goods using outside
vendors. Both companies classify production costs as either direct material, direct labor, or indirect
production costs, and they use the accounting system to determine how much cost of each type
should be assigned to product inventories.
C. Manufacturing is the sale of goods purchased at wholesale prices. Merchandising is the
production of goods using raw materials purchased at resale prices. Both companies show
inventories at the cost they pay to acquire them.
D. Manufacturing is the transformation of materials into other goods through the use of labor and
factory facilities. Merchandising companies sell goods without changing their basic forms.
Merchandising companies show inventories at the cost they pay to acquire them. Manufacturing
companies classify production costs as either direct material, direct labor, or indirect production
costs, and they use the accounting system to determine how much cost of each type should be
assigned to product inventories.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning