The cost of production of completed and transferred goods during the period amounted to $540,000, and the finished products shipped to customers had total production costs of $375,000.The entry to record the transfer of costs from work in process to finished goods is

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The entry to record the transfer of costs from work in process to finished goods is a debit to Finished Goods for the total cost of production ($540,000) and a credit to Work in Process for the same amount. The finished products shipped to customers had total production costs of $375,000, which means $165,000 ($540,000 - $375,000) is the cost of finished goods in inventory. Choice B is the only option that properly records this transfer with a debit to Finished Goods for $165,000 and a credit to Work in Process for $165,000.

The Cost of Production of Completed and Transferred Goods During