The Main Difference in the Balance Sheets of Manufacturing Vs

question 179

Multiple Choice

The main difference in the balance sheets of manufacturing vs. service business is in

• A) current assets.
• B) current liabilities.
• C) investments.
• D) equity.

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Definitions:

Raw Materials

Basic materials that are used in the production process to manufacture goods, often transformed into final products or component parts.

Production

The process of creating goods and services, involving both the conversion of raw materials into finished products and the creation of value.

Year Ended

The conclusion of a 12-month accounting period, at which financial statements are prepared to summarize the year's transactions.

Direct Materials Used

The cost of raw materials that are directly involved in the production of goods.