Under process costing,costs assigned to goods sold are transferred to the Cost of Goods Sold account from the ________.A perpetual inventory system is used.
A) Finished Goods Inventory account
B) Work-in-Process Inventory account
C) Raw Materials Inventory account
D) Sales Revenue account

Question

Quizplus · Accepted Answer

In process costing, once the goods are completed, they are transferred to the Finished Goods Inventory account. From there, the costs assigned to those goods are then transferred to the Cost of Goods Sold account when the goods are sold. A perpetual inventory system is used to continuously update the inventory accounts in real-time. Therefore, the correct option is A, Finished Goods Inventory account.

Under Process Costing,costs Assigned to Goods Sold Are Transferred to the Cost