When a job is completed and the client is billed, the costs are transferred to an account called the _____.
A) work in process account
B) cost of services account
C) expenses account
D) applied overhead account

Question

Quizplus · Accepted Answer

The costs incurred in completing a job are transferred to the cost of services account when the job is completed and the client is billed. This account reflects the total cost of providing services to customers during a specific period, which is usually a month or a calendar year. The cost of services account is a sub-account of the income statement and is used to calculate the gross profit margin of a business. The other accounts listed (work in process, expenses, applied overhead) are not relevant to this process.

When a Job Is Completed and the Client Is Billed