When Goods Are Transferred from the Work-In-Process Inventory Account to the Finished

question 132

Multiple Choice

When goods are transferred from the Work-in-Process Inventory account to the Finished Goods Inventory account:

• A)total assets and total liabilities increase by the same amount.
• B)total assets of the company remain constant.
• C)total equity and total assets increase with the same amount.
• D)total liabilities increases and total equity decreases by the same amount.

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Definitions:

Short-Term Loans

Loans that are scheduled to be repaid in less than a year.

Reserves

Funds or commodities set aside for future use or to meet unforeseen contingencies, often related to banks or natural resources.

Money Creation

The process by which the money supply of a country, or of an economic or monetary region, is increased.

Depository Institutions

Financial institutions that accept deposits from individuals and provide loans, such as banks and credit unions.