Diaz Company Uses Process Costing in Its Two Processing Departments $\begin{array}{llr} \text {Cost of Goods Sold } &62,000\\ \text { Finished Goods Inventory } &&62,000\\\end{array}$

question 21

Short Answer

Diaz Company uses process costing in its two processing departments Assembly and Finishing.If completed goods with a cost of $62,000 are sold,which one of the following journal entries would be made to record this transaction?
a.
$\begin{array}{llr} \text {Cost of Goods Sold } &62,000\\ \text { Finished Goods Inventory } &&62,000\\\end{array}$

b.
$\begin{array}{llr} \text {Cost of Goods Sold } &62,000\\ \text { Sales Revenue } &&62,000\\\end{array}$

c.
$\begin{array}{llr} \text {WIP Inventory - Assembly } &62,000\\ \text { WIP Inventory - Finishing } &&62,000\\\end{array}$

d.
$\begin{array}{llr} \text {Finished Goods Inventory } &62,000\\ \text { Cost of Goods Sold } &&62,000\\\end{array}$

e. $\text {None of the answer choices is correct.}$

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Definitions:

Payment For It

This term refers to the act of disbursing money in exchange for goods or services.

Cash Receipts

The collection of money, either in the form of cash or checks, received by a business during its operations.

Receivables Period

The median days a company waits to receive money owed by customers for goods or services delivered on credit.

Payables Period

The payables period is a financial metric that indicates the average time it takes for a company to pay its suppliers and vendors.