Finished goods inventory is debited and work in process inventory is credited for

Question

Quizplus · Accepted Answer

When goods are transferred to the finished goods storeroom, it means that they are completed and ready for sale. Therefore, finished goods inventory is debited to recognize the increase in the value of the inventory, and work in process inventory is credited to reduce its balance since the goods have been completed and removed from the production process. Choices A, C, and D do not involve the completion of goods, so they do not result in a debit to finished goods inventory.

Finished Goods Inventory Is Debited and Work in Process Inventory