Why is Raw Material inventory (beginning and ending), Work in progress inventory (beginning and ending), and finished goods (beginning and ending) closed out to manufacturing summary if these accounts are considered assets? (I understand that manufacturing summary is closed out to income summary which is then closed out to retained earnings)
What happens if a manufacturing company does not use up all the Raw materials inventory or work in progress inventory, or sell all the finished goods inventory that year ? Does the company do reversing entries to put the amounts back in those inventory accounts since they have already been closed to manufacturing summary in the prior year?
What happens if a manufacturing company does not use up all the Raw materials inventory or work in progress inventory, or sell all the finished goods inventory that year ? Does the company do reversing entries to put the amounts back in those inventory accounts since they have already been closed to manufacturing summary in the prior year?