Question

Winnie, Inc. has two processesColoring Department and Mixing Department. The company assigned $390,000 to the 6,000 gallons of paint transferred from Mixing Department to Finished Goods Inventory. The journal entry to record completion of processing is ________.

Answer 1

Answer: debit finished goods $390 000 , credit work in progress $390000

Step-by-step explanation: The transfer is only between the two inventory assets in the business- Finished goods which is when a good is finished and ready to be sold. The other inventory asset here is a work in progress because it is a processing department so the inventory is in the process of reaching completion. After the inventory is completed it should be debited into the inventory (finished goods) account. It is simply a transfer from one asset to another asset.