 is comprised of these two jobs that have been completed, this job at 3820 and this job at 27090, giving us the 6,610. So that's what we know so far. We don't know the sales number, but we know it's probably gonna be more than that, hopefully, and we don't know exactly what it is. And then we're gonna credit the finished goods. So the finished goods, it's gonna go down. So if we think about the sales number, a book problem will often give it to us. In practice, we would have to determine, of course, what our sales price could be. If it's a construction company, we may have set a bid at the beginning of the process and now complete the bid, or we might have set the price at the beginning of the process, and we may use the job cost sheets in order to determine what the price will be. For example, if we were doing a construction company or any type of job cost system, some kind of transparent system, the most transparent way to do this would be to set up an invoice saying, hey, look, this is what we actually think that Job 15, the one we worked on with you was for direct materials. Here's the direct labor. Here's the overhead, which is us allocating all those other costs that are like in the bucket that allocates out. That adds up to 3,820. And then tell our customer what we mark up for, what's our revenue proportion to this. If we say that there's a 30% markup for us for our revenue, we would say that it's for this job, 3,820 times 30.3, that's how much we're gonna earn here, plus the cost, 3,820, or we're gonna charge 4,966. Or we can do that with one calculation, that's gonna be the 3,820 times 100, 100% 0.3, 30% markup. So that's the 4,966. So that's one way we could make the invoice, which is a nice way to do it, transparent way to do it oftentimes, but it's not the only way we could make the invoice. The sales price is not tied directly to these sheets unless it's whatever we plan to do with it. So if we have these two jobs, then our journal entry for these two jobs, if we have a 30% markup, that's what we're gonna assume here, is 3,820 plus 2,790, that's the cost of those two jobs right here. And we're gonna mark that up 30%, so I'm gonna say that times 1.3. So we're gonna sell them for 8,593 then, that's how much we're gonna invoice for. So then we're gonna say that the receivables is gonna be that 8,593, and we're gonna credit the sales for 8,593. Again, if you look at a merchandising company, you probably think of this journal entry first because we're concentrated on the sales all the time, with the sales price, and then we'll think about the cost of goods sold. Here, like book problems may not even ask you for this journal entry, even though it's the thing we're most focused on in practice because we're focused on earning revenue, getting money, but this whole problem has been focusing in on this journal entry, this component of it. So just be aware that when we get to this last step, that we have to figure out the sales price and it's not tied directly here. A book problem's gonna have to give it to us in practice. We will of course have a system of determining what the invoicing price will be and it may be based on these job cost systems, but not necessarily directly applied to them. So now we will record the journal entry to our general journal. So here's the accounts receivable. It started at 180. We're gonna bring it up in the debit direction by 8,593 to 188,593. That then found on our trial balance. Then we have the sales here. So the sales was at zero. It's gonna go up in the credit direction by 8,593 to 8,593. That then being also found on the trial balance. And then we've got the cost of goods sold. It started at 380. That just being the closing out of the factory overhead to make it zero at the end of the time period, remember? And that happened in a prior presentation. And then we're gonna say that this 6,610 is gonna bring the balance up to 6,990. So there's our 6,990. Here it is on the trial balance. And then we've got the finished goods. So the finished goods started at 8,736. It's gonna go down by 6,610 to 2,126. That 2,126 also being found on our trial balance. So what's happened here is just basically our normal type of journal entry. Once we get these numbers, just our normal journal entry when we make a sale as it would be if it was a merchandising company recording an increase in sales, which increased net income. And the other side being the accounts receivable, people owing us money. We expect to get a check in the mail, hopefully. And then we recorded the cost of that inventory bringing the net income down. So of course the net sale is this number minus this number. That's what we really kind of net income is affected by or gross profit, net income and gross profit by this journal entry. And then we recorded the reduction in the finished goods just as we would in a merchandising company reducing the inventory account for those inventory items that were sold. So if we look at our completed worksheet here and related to our trial balance, we can still tie this information out to what we have now. So we've got our closed jobs is just gonna be this 2,126. That's the only one that's still closed, but not shipped. And therefore still in the finished goods. Goods. Then we have the amount that is open. That's gonna be those two green ones. I can't decide where to put the calculator. It's gonna be these two green ones. So it's gonna be this 2390 plus the 2024. That's gonna be the 4,414. That being found here. So there's the 4,414. Now again, the cost of goods sold, we can't normally track all the way through. But if we adjust the time periods and go through the cost sheets, in this case, we could say that it's the 3820 plus the 2790. It's gonna be that 6,610 and zero. Doesn't tie out to the 6,610 zero here. Why? Because it's off by the under overapplied overhead that we had. That's gonna be off by this 380, the under overapplied overhead. So again, the cost of goods sold isn't gonna be able to tie out to our job sheet necessarily, not just because of that under or overapplied overhead, but also because it's a temporary account. And we're gonna have a whole lot of shipped jobs over time as months go by. We of course will have a lot of shipped jobs. So we could try to add up the shipped jobs that were completed during a certain time period. But typically what we do here for sure is we wanna support the open jobs with the working process account. And we wanna support the finished jobs with the job accounts. And so these two accounts need to be supported by job cost sheets. As we sell them, of course, we will then use these job cost sheets to determine what the cost of goods sold will be.