Question

Question: Give the journal entry for the completion of a job. How is the accounting equation affected?

Short answer

Answer:

When a job is completed, Finished Goods Inventory is debited and Work-in-Process Inventory is credited. The effect on the accounting equation is that one asset (Finished Goods Inventory) is increased and another asset (Work-in-Process Inventory) is decreased.

Step-by-step solution

Finished goods inventory

Finished goods inventory means the total stock available for sale to the customers. It is the goods which are completely manufactured.

Journal entry to record the completion of the job

Date	Particulars	Debit ($)	Credit ($)
	Finished goods inventory	XXX
	Work in process inventory		XXX

This transaction may increase the one asset and decrease the other asset. Its total effect is null.