The major difference on the balance sheet of a manufacturing company when compared to a merchandise company is to include:

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A manufacturing company would have three inventory accounts: raw materials, work in progress, and finished goods. This is because they produce goods and must account for the materials needed and the different stages of production. Merchandise companies only have one inventory account as they purchase and resell goods. Retained earnings, prepaid expenses, and accrued payroll can be included on the balance sheet of both manufacturing and merchandise companies.

The Major Difference on the Balance Sheet of a Manufacturing