MGAB01H3 Chapter Notes - Chapter 7: Perpetual Inventory, Finished Good
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MGAB01H3 Full Course Notes
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Reporting and interpreting cost of sales and inventory. Merchandise inventory: goods held for resale in the ordinary course of business: acquired in a finished condition, ready for resale. Raw materials inventory: items acquired for the purpose of processing into finished goods. Work-in-process inventory: includes goods in the process of being manufactured. Finished goods inventory: includes manufactured goods that are complete and available for sale. Costs included in inventory purchases: cash-equivalent cost, price payed or consideration given, sum of total costs to bring in an article (saleable good, freight-ins, purchase returns and allowances, purchase discounts, direct sales for customers. Flow of inventory costs: flow of inventory costs for merchandisers (wholesalers & retailers, purchase new inventory, inventory increases, raw materials (direct materials) Direct labour: refers to the earnings of employees who work directly on the products being manufactured. Factory overhead: includes manufacturing costs that are not raw materials.