Figure 6-12 Twinnings Corporation manufactures Scheduling Books. There are two processes: printing and binding. The following information is given for the printing department for September.
Units:
Costs:
The company uses FIFO inventory assumption.
Refer to Figure 6-12. What is the journal entry for the cost of goods sent to binding?

Question

Figure 6-12 Twinnings Corporation manufactures Scheduling Books. There are two processes: printing and binding. The following information is given for the printing department for September.
Units:
 Costs:
 The company uses FIFO inventory assumption.
Refer to Figure 6-12. What is the journal entry for the cost of goods sent to binding?

Quizplus · Accepted Answer

According to the FIFO inventory assumption, the cost of goods sent to binding would be the cost of the oldest units first. Therefore, the cost for the printing department's 10,340 units at $23.80 per unit would be sent to binding. The journal entry would be:
Work in process - Binding $246,340
Work in process - Printing $246,340

Figure 6-12 Twinnings Corporation Manufactures Scheduling Books