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12 May, 01:12

Mulligan, Inc., which uses a process-cost accounting system, passes completed production from Department A to Department B for further manufacturing. The journal entry to record completed production in Department A requires:

a. a debit to Finished-Goods Inventory and a credit to Work-in-Process Inventory: Department A.

b. a debit to Finished-Goods Inventory and a credit to Work-in-Process Inventory.

c. a debit to Work-in-Process Inventory and a credit to Finished-Goods Inventory.

d. a debit to Work-in-Process Inventory: Department B and a credit to Work-in-Process Inventory: Department A.

e. a debit to Work-in-Process Inventory: Department A and a credit to Work-in-Process Inventory: Department B.

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  1. 12 May, 01:25
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    d. a debit to Work-in-Process Inventory: Department B and a credit to Work-in-Process Inventory: Department A.

    Explanation:

    The journal entry is shown below:

    Work in progress inventory - Department B A/c Dr

    To Work in progress inventory - Department A A/c

    (Being the completed production is recorded)

    For recording, we debited the Work-in-Process Inventory - Department B Account and credited the Work-in-Process Inventory - Department A Account so that the correct posting can be done
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