Which of the following accounts would NOT appear on a schedule of cost of goods manufactured?

• A. Manufacturing Overhead
• B. Finished Goods Inventory
• C. Direct Labor
• D. Direct Materials

Answer: (B)

Verified step by step guidance

1. Understand the purpose of a schedule of cost of goods manufactured: This schedule is used to calculate the total manufacturing costs incurred during a period and determine the cost of goods completed and transferred to Finished Goods Inventory. It includes Direct Materials, Direct Labor, and Manufacturing Overhead.
2. Review the components of the schedule: The schedule includes three main categories of costs: Direct Materials (raw materials used in production), Direct Labor (wages of workers directly involved in production), and Manufacturing Overhead (indirect costs like factory utilities, depreciation, etc.).
3. Identify the role of Finished Goods Inventory: Finished Goods Inventory represents completed products that are ready for sale. It is not part of the cost of goods manufactured schedule because it is an account on the balance sheet, not a manufacturing cost.
4. Compare the given options: Direct Materials, Direct Labor, and Manufacturing Overhead are all components of the cost of goods manufactured schedule. Finished Goods Inventory, however, is not included in this schedule.
5. Conclude that Finished Goods Inventory would NOT appear on a schedule of cost of goods manufactured, as it is a balance sheet account and not a manufacturing cost.