Question

Dazzle, Incorporated produces bread for jewelry making use. The journal entry to record June production activities for goods transferred from production to finished goods is:

a) Debit Finished Goods, Credit Work in Process.
b) Debit Work in Process, Credit Finished Goods.
c) Debit Finished Goods, Credit Raw Materials.
d) Debit Work in Process, Credit Raw Materials.

Answer 1

The correct journal entry to record June production activities for goods transferred from production to finished goods is to debit Work in Process and credit Finished Goods.

Step-by-step explanation:

The correct journal entry to record June production activities for goods transferred from production to finished goods is option b) Debit Work in Process, Credit Finished Goods.

When goods are transferred from the production department to the finished goods department, the cost of production is moved from Work in Process (WIP) to Finished Goods. Therefore, we debit the Work in Process account to reduce its balance and credit the Finished Goods account to increase its balance.

For example, if Dazzle, Incorporated produced bread for jewelry making in June, they would debit Work in Process and credit Finished Goods in their journal entry.