Fun Stuff Manufacturing produces frisbees using a three-step sequential process that includes molding,coloring and finishing.When the frisbees and associated costs are transferred out of the coloring process and into the finishing process,the journal entry would include a

Question

Quizplus · Accepted Answer

When the frisbees and associated costs are transferred out of the coloring process and into the finishing process, the frisbees are no longer considered to be in the WIP inventory of the Coloring process but are now part of the WIP inventory of the Finishing process. Therefore, there should be a debit to WIP Inventory-Finishing and a credit to WIP Inventory-Coloring to reflect the transfer of the frisbees and associated costs. Option C is the only choice that reflects this accounting treatment.

Fun Stuff Manufacturing Produces Frisbees Using a Three-Step Sequential Process