Barnett, Inc., which uses a process-costing system, transfers completed production from Department no. 1 to Department no. 2 for further work. Which of the following best describes the account that would be credited to record this transfer?
A) Cost of Goods Transferred.
B) Finished-Goods Inventory: Department no. 1.
C) Finished-Goods Inventory: Department no. 2.
D) Work-in-Process Inventory: Department no. 1.
E) Work-in-Process Inventory: Department no. 2.

Question

Quizplus · Accepted Answer

The transfer of completed production from Department no. 1 to Department no. 2 would involve crediting the Work-in-Process Inventory account for Department no. 1, as the costs are being transferred out of this department.