The cost of unsold inventory at the end of the year is classified as a(n) ________ in the ________.

A) Asset; Balance sheet

B) Expense; Income statement

C) Liability; Balance sheet

D) Revenue; Income statement

Answer: Asset; Balance sheet

Inventory does not include:

A) Materials used in the production of goods to be sold.

B) Assets intended to be sold in the normal course of business.

C) Equipment used in the manufacturing of assets for sale.

D) Assets currently in production for normal sales.

Answer: Equipment used in the manufacturing of assets for sale.

What type of company purchases raw materials and makes goods to sell?

A) Wholesaler.

B) Retailer.

C) Merchandiser.

D) Manufacturer.

Answer: Manufacturer.