Hornsby has a single production department, and uses a process-costing system. The balance in its Work-in-Process account on January 1 was $75,000. The account was charged with direct materials, direct labor, and manufacturing overhead of $488,000 throughout the year. If a review of the accounting records determined that $176,000 of goods were still in production at year-end, Hornsby should make a journal entry on December 31 that includes:

Multiple Choice

• a debit to Cost of Goods Sold for $387,000.

• a debit to Finished-Goods Inventory for $387,000.

• a debit to Work-in-Process Inventory for $387,000.

• a debit to Finished-Goods Inventory for $176,000.

• a credit to Work-in-Process Inventory for $176,000.