Job Cost Accounting Journal Entries

The job cost accounting journal entries below act as a quick reference, and set out the most commonly encountered situations when dealing with the double entry posting of job costing.

The journal entries follow the job costing process from purchase of raw materials, allocation of direct materials, direct labor, and manufacturing overhead to work in process, transfer of the goods through to finished goods and finally to cost of goods sold and sales.

In each case the job cost accounting journal entries show the debit and credit account together with a brief narrative. For a fuller explanation of journal entries, view our examples section.

Typical Job Cost Accounting Journal Entries


To purchase raw materials
AccountDebitCredit
Raw materials inventoryXXX
Accounts payableXXX

To accrued labor cost
AccountDebitCredit
Labor costXXX
Wages payableXXX

To transfer indirect materials, indirect labor and other overhead to manufacturing overhead account
AccountDebitCredit
Manufacturing overheadXXX
Raw materials (indirect)XXX
Labor cost (indirect)XXX
DepreciationXXX
UtilitiesXXX
Other costsXXX

To transfer direct materials, direct labor, and manufacturing overhead (at the predetermined rate) to work in process
AccountDebitCredit
Work in process inventoryXXX
Raw materials inventoryXXX
Direct labor costXXX
Manufacturing overheadXXX

To transfer work in process to finished goods
AccountDebitCredit
Finished goods inventoryXXX
Work in process inventoryXXX

To transfer finished goods to cost of goods sold
AccountDebitCredit
Cost of goods soldXXX
Finished goodsXXX

To record the sale of the goods
AccountDebitCredit
Accounts receivableXXX
SalesXXX

Last modified January 13th, 2020 by Michael Brown

About the Author

Chartered accountant Michael Brown is the founder and CEO of Double Entry Bookkeeping. He has worked as an accountant and consultant for more than 25 years and has built financial models for all types of industries. He has been the CFO or controller of both small and medium sized companies and has run small businesses of his own. He has been a manager and an auditor with Deloitte, a big 4 accountancy firm, and holds a degree from Loughborough University.

You May Also Like