Costs are moved from Inventory to Cost of Sales when the products are sold. If in the year 2012 Scarpa Shoe Company sold shoes with direct material and labor costs of $1,000,000 and overhead costs of

$400,000, the entry would be:

Dr. Cost of Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Cr. . . . . . . . . . . . . . . . . . . . . .