The journal entry to record the transfer of 1,600 units of part number 1177 with a value of $2.50 each,to work in process is

Question

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The transfer of 1,600 units of part number 1177 with a value of $2.50 each to work in progress signifies that the materials are being used in the manufacturing process. Therefore, the journal entry needs to show a decrease in materials inventory and an increase in work in process. Choice C is the best option because it shows a decrease in Materials inventory of $4,000 (1,600 units x $2.50 per unit) and an increase in Work in Process of the same amount. Choice A is incorrect because it shows only an increase in Work in Process, without reflecting the decrease in Materials inventory. Choice B is incorrect because it shows the entry spreading the $4,000 over two accounts, neither of which reflect the decrease in Materials inventory. Choice D is incorrect because it shows a cash transaction, which is not indicated by the scenario.

The Journal Entry to Record the Transfer of 1,600 Units