CAF-5 · Chapter 6 · Question 8 of 10
When a job is completed and the goods are transferred to the finished goods warehouse awaiting the customer's disposition, what is the correct journal entry?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Debit: Finished Goods / Credit: Work in Process
Explanation
When a job is completed and sent to the finished goods store before delivery, the cost is transferred out of the production account into inventory. The entry is to Debit: Finished Goods and Credit: Work in process.
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