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Chapter 5 - Chapter 5 The Purchase and Sale of Inventory 1...

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6-1 1 The Purchase and Sale of Inventory Chapter 5 2 Inventory Assets held for resale or for use in the production of goods for sale Inventory is tangible property that is held for resale or will be used in producing goods or services.
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6-2 3 Inventory Inventory is reported on the balance sheet as a current asset . Types of inventory: Merchandise inventory Raw materials inventory These 3 will Work in process inventory be studied Finished goods inventory in managerial accounting. 4 Inventory Cost (A value reported in Balance Sheet) Include all costs incurred to bring the asset to useable or saleable condition, such as: 1. Invoice price 2. Taxes 3. Freight charges (Delivery costs) 4. Inspection costs 5. Preparation costs.
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