Question

Work-in-process that is being transferred into a department is debited to that work-in-process account, while work-in-process that is being transferred out of a department is credited to that work-in-process account True False

Answer 1

True

Step-by-step explanation:

Work in process refers to those goods which require further processing. When a department transfers work in process(WIP) to another department, the recipient department's stock of WIP is debited i.e debit the receiver principle.

Similarly work in process that is being transferred out of a department would be recorded like Purchase return i.e credit what goes out.

A debit in WIP account increases it's balance whereas a credit in WIP account reduces it's balance.