How to Record Cost of Goods Manufactured
Journal entry to transfer costs from Work in Process to Finished Goods upon completion of the production cycle.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Finished Goods Inventory | Debit | 75,000.00 | - |
| Work in Process Inventory | Credit | - | 75,000.00 |
💡 Accountant's Note
This entry represents the total cost of products that have completed the manufacturing process and are ready for sale.
Practitioner & Systems Framework
💻 ERP Architecture
Automated upon 'Job Closing' or 'Production Order Completion' in most manufacturing modules.
⚠️ Audit Flags
Large balances in WIP that do not move to Finished Goods may indicate stalled production or improper cost accumulation.
📄 Required Documentation
Completed production orders, bill of materials (BOM) cost summary, and routing labor hours.
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Expert Analysis by Qusai Ahmad
General Accountant Supervisor & IFRS Specialist
Specialized in SAP GUI automation and Middle Eastern tax compliance. Building digital tools for the next generation of finance leaders.
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