Job order Costing Journal Entries

This video shows how to record journal entries to account for the flow of costs when a manufacturer uses Job-order Costing. A journal entry is made to record the purchase of raw materials, which is debited to raw materials inventory. When the raw materials are put into production, another journal entry is recorded to transfer the costs from raw materials inventory to Work-in-Process Inventory. When direct labor costs are incurred or manufacturing overhead is applied to jobs, these also increase the Work-in-Process Inventory account. Meanwhile, actual manufacturing overhead costs are debited when incurred. When a job is finished, the costs of the job are transferred from the Work-in-Process Inventory account to the Finished Goods Inventory account. When the job is sold, the costs of the job are transferred from the Finished Goods Inventory account to Cost of Goods Sold. Edspira website: https://www.edspira.com/— Edspira is the creation of Michael McLaughlin, an award-winning professor who went from teenage homelessness to a PhD. Edspira’s mission is to make a high-quality business education freely available to the world. — SUBSCRIBE FOR A FREE 53-PAGE GUIDE TO THE FINANCIAL STATEMENTS, PLUS: • A 23-PAGE GUIDE TO MANAGERIAL ACCOUNTING • A 44-PAGE GUIDE TO U.S. TAXATION • A 75-PAGE GUIDE TO FINANCIAL STATEMENT ANALYSIS • MANY MORE FREE PDF GUIDES AND SPREADSHEETS http://eepurl.com/dIaa5z — SUPPORT EDSPIRA ON PATREON *  / prof_mclaughlin   — GET CERTIFIED IN FINANCIAL STATEMENT ANALYSIS, IFRS 16, AND ASSET-LIABILITY MANAGEMENT https://edspira.thinkific.com — LISTEN TO THE SCHEME PODCAST Apple Podcasts: https://podcasts.apple.com/us/podcast... Spotify: https://open.spotify.com/show/4WaNTqV... Website: https://www.edspira.com/podcast-2/ — GET TAX TIPS ON TIKTOK   / prof_mclaughlin   — ACCESS INDEX OF VIDEOS https://www.edspira.com/index — CONNECT WITH EDSPIRA Facebook:   / edspira   Instagram:   / edspiradotcom   LinkedIn:   / edspira   — CONNECT WITH MICHAEL Twitter:   / prof_mclaughlin   LinkedIn:   / prof-michael-mclaughlin   — ABOUT EDSPIRA AND ITS CREATOR https://www.edspira.com/about/ https://michaelmclaughlin.com