The income statements of manufacturing companies are much less complex than those of service or merchandising companies.

Question

Quizplus · Accepted Answer

The income statements of manufacturing companies are typically more complex than those of service or merchandising companies because they include additional cost of goods sold components such as direct materials, direct labor, and overhead expenses. Additionally, manufacturing companies may have inventory valuations and adjustments that can affect their income statements.

The Income Statements of Manufacturing Companies Are Much Less Complex