Question

EB14.

LO 4.7Job 113 was completed at a cost of $7,500, and Job 85 was completed at a cost of $2,300 and sold on account for $4,500. Prepare journal entries for the following:

Completion of Job 113.
Completion and sale of Job 85.

Answer 1

Journal entries for the Completion of Job 113

Debit Finished Good/Inventory Account $ 7500

Credit WIP JOB 113 Account $ 7500

(In words we will debit finished good account by shifting work in process related to the job 113 in it)

Journal entries for the Completion and sale of Job 85

Debit Finished Good/Inventory Account $ 2300

Credit WIP JOB 113 Account $ 2300

For sales following two entries will be passed.

Debit Cost of Good Sold Account $ 2300

Credit Finished Good/Inventory Account $ 2300

Debit Cash (or Receivable if credit sale) $ 4500

Credit Sales Account $ 4500