O'Hare Company is a manufacturing firm that uses a job-order cost system to determine the costs of its products. O'Hare Company sold job #132 for $8,200 cash. The job cost sheet for that job reported total manufacturing costs of $5,900. The recognition of this event on the financial statements would include a(n):

Question

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The recognition of the sale of job #132 would increase total assets and total equity by $8,200. The total manufacturing costs of $5,900 would be deducted from the revenue of $8,200 to determine the net income, which would also increase as a result of the sale. There would be no impact on total liabilities, and there is no reason to believe that there would be a decrease to total assets or total equity.

O'Hare Company Is a Manufacturing Firm That Uses a Job-Order