The subtotal "Cost of goods manufactured" appears on
A) a merchandising company's income statement.
B) a manufacturing company's income statement.
C) both a manufacturing and a merchandising company's income statement.
D) neither a merchandising nor a manufacturing company's income statement.

Question

Quizplus · Accepted Answer

The subtotal "Cost of goods manufactured" appears on a manufacturing company's income statement as it represents the cost incurred in producing the goods during a period. This cost includes direct materials, direct labor, and manufacturing overhead. A merchandising company's income statement does not have this subtotal as it does not manufacture goods, but instead purchases and resells them.

The Subtotal "Cost of Goods Manufactured" Appears on