[The Following Information Applies to the Questions Displayed Below

question 32

Multiple Choice

[The following information applies to the questions displayed below.]
Sue's Soup Products uses a process costing system with two processing departments: the Mixing and Cooking Department and the Canning Department.Work in process inventories are reduced to zero each month.In March,the Mixing and Cooking Department incurred manufacturing costs of $63,000 to mix 42,000 gallons of soup.The Canning Department incurred manufacturing costs of $9,000.A total of 170,000 cans of soup were transferred to the finished goods warehouse during the month.
-The journal entry to record the transfer of soup out of the Mixing and Cooking Department during March would include:

• A)A debit to Work in Process Inventory,Mixing and Cooking Department of $63,000.
• B)A credit to Work in Process Inventory,Canning Department of $72,000.
• C)A debit to Finished Goods Inventory of $72,000.
• D)A credit to Work in Process Inventory,Mixing and Cooking Department of $63,000.

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Definitions:

Static Budget

A budget that remains unchanged regardless of changes in activity levels, sales volume, or other variables during the budget period.

Variable Costs

Costs that vary directly with the level of production or volume of output, which includes expenses like raw materials and labor directly involved in production.

Fixed Costs

Expenses that do not change with changes in production level or sales volume.

Controllable Costs

Expenses that can be influenced or managed by a specific manager or department within a company.