Asked by Daniel Romero on May 11, 2024
Verified
Merchandise Inventory is recorded on the:
A) Balance Sheet.
B) Statement of owner's equity.
C) Income Statement.
D) None of these is correct.
Merchandise Inventory
Goods or products that a company holds for the main purpose of selling them to customers.
Balance Sheet
The balance sheet is a financial statement that provides a snapshot of a company's financial position, listing assets, liabilities, and shareholders' equity at a specific point in time.
- Identify the appropriate accounts to be debited and credited in various merchandise transactions under both inventory systems.
- Differentiate between the accounts impacted in the perpetual inventory system.
Verified Answer
SD
Siobhan DawidiMay 13, 2024
Final Answer :
A
Explanation :
Merchandise Inventory is an asset and is recorded on the Balance Sheet. It represents the goods available for sale to customers and is considered a current asset because it is expected to be sold within a year.
Learning Objectives
- Identify the appropriate accounts to be debited and credited in various merchandise transactions under both inventory systems.
- Differentiate between the accounts impacted in the perpetual inventory system.