Question

After reviewing the financial statements of Mallett Company, Dan Russell concluded that the company was a service company. Mr. Russell based his conclusion on the fact that Mallett’s financial statements displayed no inventory accounts.

Required
Explain how Mallett’s implementation of a 100 percent effective just-in-time inventory system could have led Mr. Russell to a false conclusion regarding the nature of Mallett’s business.



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  • CreatedFebruary 07, 2014
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