Total manufacturing costs incurred during a period are transferred to the
A)Cost of Goods Sold account.
B)Work in Process Inventory account.
C)Finished Goods Inventory account.
D)Overhead account.

Question

Quizplus · Accepted Answer

The manufacturing costs incurred during a period are first recorded in the Work in Process Inventory account as the goods are being produced. Once the production is completed, the costs are then transferred from the Work in Process Inventory account to the Finished Goods Inventory account. From there, the costs move to the Cost of Goods Sold account when the finished goods are sold. The overhead account is used to record indirect expenses related to manufacturing, such as rent, utilities, and insurance.

Total Manufacturing Costs Incurred During a Period Are Transferred to the