When a job is completed,the journal entry involves a:

Question

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When a job is completed, it means the costs associated with that job have been fully incurred and the finished goods are ready to be sold. Therefore, the journal entry involves a debit to finished goods inventory (to recognize the cost of the completed job) and a credit to work in process inventory (to remove the cost of the completed job from this account). Choice A is incorrect because work in process inventory represents the costs of unfinished jobs, not completed ones. Choice C is incorrect because cost of goods sold is an expense account and is only debited when the finished goods are sold. Choice D is incorrect because finished goods is a balance sheet account and is only credited when the finished goods are sold.

When a Job Is Completed,the Journal Entry Involves A