ECONOMICS

Detailed explanation-1: -Answer and Explanation: Answer: c. a debit to Cost of Goods Sold and a credit to Finished Goods Inventory.

Detailed explanation-2: -You should record the cost of goods sold as a business expense on your income statement. Under COGS, record any sold inventory. On most income statements, cost of goods sold appears beneath sales revenue and before gross profits. You can determine net income by subtracting expenses (including COGS) from revenues.

Detailed explanation-3: -Once the product is complete, the company needs to reclass the value of that inventory to finished goods since it is now ready to be sold. The journal entry would be a debit to inventory-finished goods and a credit to inventory-WIP. The net impact to the balance sheet is zero.

Detailed explanation-4: -What is a journal entry for cost of goods sold? The journal entry for cost of goods sold is a calculation of beginning inventory, plus purchases, minus ending inventory.

Detailed explanation-5: -A debit is made to the cost of goods sold and a credit is made to the finished goods account to switch the finished goods to the expense account for sale. Then, the sales account is credited, and the accounts receivable account is debited to transfer from the expense account to the revenue account.