Inventories refer to A) goods which have been presold before they are produced. B) goods that have been produced but not yet sold. C) goods that have been planned but not yet produced. D) goods that have been produced and sold in the same year.

Question

Briley Cuevas

Business

23 August, 01:20

Inventories refer to A) goods which have been presold before they are produced. B) goods that have been produced but not yet sold. C) goods that have been planned but not yet produced. D) goods that have been produced and sold in the same year.

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Answers (1)

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Jayleen Reid · Answer 1

Option (B) is correct.

Explanation:

Inventories refers to the amount of goods that are already been produced but not yet sold. It is the output of the goods that companies sell in the market.

There are two types of inventories:

(a) Beginning inventories

(b) Ending Inventories

It is also known as merchandise which includes electronic items, cars, clothes, etc.

Inventories is reflected on the asset side of the balance sheet.