Winnie,Inc.has two processes-Coloring Department and Mixing Department.The company assigned $300,000 to the 3,500 gallons of paint transferred from Mixing Department to Finished Goods Inventory.The journal entry to record completion of processing is ________.
A) debit Work-in-Process Inventory-Mixing, $300,000; credit Finished Goods Inventory, $300,000
B) debit Finished Goods Inventory, $300,000; credit Cost of Goods Sold, $300,000
C) debit Cost of Goods Sold, $300,000; credit Finished Goods Inventory, $300,000
D) debit Finished Goods Inventory, $300,000; credit Work-in-Process Inventory-Mixing, $300,000

Question

Quizplus · Accepted Answer

When goods are completed in the production process and transferred to finished goods inventory, the cost associated with those goods is moved from the Work-in-Process (WIP) Inventory account to the Finished Goods Inventory account. This is done by debiting Finished Goods Inventory and crediting the WIP Inventory account for the department from which the goods were completed, in this case, the Mixing Department.