Question

The journal entry to assign costs of direct labor used in production includes which two of the following?

1) Debit to Work in Process Inventory and Credit to Direct Labor Expense
2) Debit to Direct Labor Expense and Credit to Work in Process Inventory
3) Debit to Direct Labor Expense and Credit to Manufacturing Overhead
4) Debit to Manufacturing Overhead and Credit to Direct Labor Expense

Answer 1

The correct journal entry to assign costs of direct labor used in production is a debit to Work in Process Inventory and a credit to Direct Labor Expense.

Step-by-step explanation:

The correct journal entry to assign costs of direct labor used in production is:

1. Debit to Work in Process Inventory and Credit to Direct Labor Expense

This journal entry reflects the transfer of the cost of direct labor from the Direct Labor Expense account to the Work in Process Inventory account. This is because direct labor is a cost directly associated with production and should be included in the inventory valuation.