Question

Mocha Company manufactures a single product by a continuous process involving three production departments. The records indicate that direct materials, direct labor, and applied factory overhead for Department 1 were $100,000, $125,000, and $150,000, respectively. The records further indicate that direct materials, direct labor, and applied factory overhead for Department 2 were $50,000, $60,000, and $70,000, respectively. Department 2 has transferred in costs of $390,000 for the current period. In addition, work in process at the beginning of the period for Department 2 totaled $75,000 and work in process at the end of the period totaled $90,000. The journal entry for the flow of costs into Department 3 during the period is

a. Work in Process—Department 3 375,000

Work in Process—Department 2 375,000

b. Work in Process—Department 3 570,000

Work in Process—Department 2 570,000

c. Work in Process—Department 3 490,000

Work in Process—Department 2 490,000

d. Work in Process—Department 3 555,000

Work in Process—Department 2 555,000

Answer

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