Topic: GL Transaction of producing the finished goods need to be reviewed
During testing procedures and after passing through all the steps of work order till the producing step every thing seems to be OK , but when I went through producing by pressing the button of "produce" one general ledger transaction must be done which I guess it is predefined , and here is the transaction I found
By 14000 Stock 95.59
To 14000 Stock 64.29
To 14000 Stock 31.30
but what it should be is
By 14002 Finished Goods 95.59
To 14000 Stock 64.29
To 14000 Stock 31.30
and if we want to be more accurate we have to add more procedure when the material and the costs loaded to the work order by doing this transaction for the raw material issuance
By 14001 Work In Process 95.59
To 14000 Stock 64.29
To 14000 Stock 31.30
then when the production finished
By 14002 Finished Goods 95.59
To 14000 Stock 64.29
To 14000 Stock 31.30
and the transaction of the other cost should be
By 14001 Work In Process 50
To 11000 Bank 50
you have to note that we are as accountants some times using intermediate accounts for the purpose of internal control so we can do the previous transaction like this
By Wages xxx
To Bank xxx
By Work in Process xxx
to Wages xxx
so please try to fix the transaction that will be processed when producing the finished goods in the light of the last notes
Abdelhamid & Co Certified Public Accountants & Auditors - UAE - Sharjah
(ACPA & IACPA) - (International Arab Certified Public Accountant)- IASCA Fellow Member
Mobile "WhatsApp" : +971 50 7948028