Which type of company purchases raw materials and manufactures goods to sell?

• A. Manufacturing company
• B. Merchandising company
• C. Retail company
• D. Service company

Answer: (A)

Verified step by step guidance

1. Understand the types of companies listed in the problem: Manufacturing company, Merchandising company, Retail company, and Service company.
2. Define a Manufacturing company: This type of company purchases raw materials and transforms them into finished goods through a production process. These goods are then sold to customers.
3. Define a Merchandising company: This type of company buys finished goods from suppliers and sells them to customers without altering the goods.
4. Define a Retail company: A subset of merchandising companies, retail companies sell goods directly to consumers, typically in smaller quantities.
5. Define a Service company: This type of company provides intangible services rather than physical goods to customers.