Following is a partial process cost summary for Mitchell Manufacturing's Canning Department. If the units completed were transferred to the Labeling Department,what is the appropriate journal entry to transfer the direct materials?
A)Work in Process-Labeling $135,500;Work in Process-Canning $135,500.
B)Work in Process-Labeling $176,500;Work in Process-Canning $176,500.
C)Finished Goods-Labeling $135,500;Finished Goods-Canning $135,500.
D)Work in Process-Labeling $176,500;Finished Goods-Canning $176,500.
E)Finished Goods $136,000;Work in Process $136,000.

Question

Following is a partial process cost summary for Mitchell Manufacturing's Canning Department.  If the units completed were transferred to the Labeling Department,what is the appropriate journal entry to transfer the direct materials?
A)Work in Process-Labeling $135,500;Work in Process-Canning $135,500. 
B)Work in Process-Labeling $176,500;Work in Process-Canning $176,500. 
C)Finished Goods-Labeling $135,500;Finished Goods-Canning $135,500. 
D)Work in Process-Labeling $176,500;Finished Goods-Canning $176,500. 
E)Finished Goods $136,000;Work in Process $136,000.

Quizplus · Accepted Answer

The appropriate journal entry to transfer the direct materials from Work in Process-Canning to Work in Process-Labeling would be a debit to Work in Process-Labeling for $135,500 and a credit to Work in Process-Canning for $135,500. This is because the direct materials are being transferred from one department's Work in Process account to another department's Work in Process account. Therefore, choice A is the correct answer.

Following Is a Partial Process Cost Summary for Mitchell Manufacturing's