Question

Materials purchases $40,000

Materials used 44,000
Direct labor 30,000
Actual manufacturing overhead 56,000
Cost of goods completed and transferred to Finishing Dept. 120,000
The overhead rate is 200 percent of direct labor cost. The journal entry to record goods completed and transferred out of the Assembly Department would include a
debit to Finished Goods Inventory for $120,000
credit to Materials Inventory for $120,000
debit to WIP-Assembly Department for $120,000
debit to WIP Finishing Department for $120,000

Answer 1

The journal entry to record goods completed and transferred out of the Assembly Department would include a debit to Finished Goods Inventory for $120,000 and a credit to WIP-Assembly Department for $120,000.

Step-by-step explanation:

The journal entry to record goods completed and transferred out of the Assembly Department would include a debit to Finished Goods Inventory for $120,000 and a credit to WIP-Assembly Department for $120,000.

This is because the cost of goods completed and transferred out of the Assembly Department is added to the Finished Goods Inventory account, while the corresponding cost is removed from the Work-in-Process (WIP) Assembly Department account.