On 30 June,Coraline Company finished job number 750,with total job costs of $4 600,and transferred the costs to Finished goods.On 6 July,they completed the sale of the goods to a customer for $5 100 cash.In order to record the sale,two entries are necessary,one to record revenue,and one to record cost of sales.Which of the following is the correct entry needed to record the cost of sales?

Question

Quizplus · Accepted Answer

The cost of sales needs to be debited and the finished goods inventory needs to be credited, as the costs incurred for the job are being removed from inventory and recognized as an expense. Option A and B are incorrect because they do not reflect the transfer of costs from inventory to cost of sales. Option D is incorrect because work in process inventory is not relevant in this scenario as the job has already been completed and transferred to finished goods inventory.

On 30 June,Coraline Company Finished Job Number 750,with Total Job