The Solar Company manufactures solar panels for businesses. Solars accountant, Andy, is preparing the month end reports and journal entries. He sees that during the month of September, Solar transferred $305, 500 of completed solar panels to the appropriate account. What is the journal entry to record this transaction?

INTRODUCTION TO COST ACCOUNTING

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

The Solar Company manufactures solar panels for businesses. Solar’s accountant, Andy, is preparing the month end reports and journal entries. He sees that during the month of September, Solar transferred $305, 500 of completed solar panels to the appropriate account. What is the journal entry to record this transaction?

A	Debit Finished Goods for $305, 500 and Credit Work in Process for $305, 500
B	Debit Finished Goods for $305, 500 and Credit Cost of Goods Sold for $305, 500
C	Debit Cost of Goods Sold for $305, 500 and Credit Finished Goods for $305, 500
D	Debit Work in Process for $305, 500 and Credit Finished Goods for $305, 500

Explanation:

Detailed explanation-1: -Polycrystalline solar panels Polycrystalline, also known as multi-crystalline solar panels are considered to be less efficient than monocrystalline panels, but more cost-friendly.

Detailed explanation-2: -Thin-film panels are flexible and can be made from various materials and not just silicon. This type of solar panel is much cheaper than the other two types of panels. Customers can save on installation costs as well due to its lightweight construction.

Detailed explanation-3: -With the rated wattage of a solar panel, anyone can determine how much electricity a solar panel will produce by using this simple formula: Power in watts x Average hours of direct sunlight = Daily Watt-hours. With this basic approach, it is easy to calculate energy production by week, month and year.

Detailed explanation-4: -Thomas Yoon, President and Chief Executive Officer at LG Electronics North America, said, “We hope we can retain many of our dedicated employees. The company is meeting U.S. solar panel workers to identify potential opportunities within other LG business and manufacturing units.

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