Question

Altec Designs makes fashion clothing and reports the following data for the month of September: Salaries paid to seamstresses $140,000, Wages paid to fabric cutters $20,000, Indirect wages $5,000. What is the journal entry to record the total labor charges incurred during September, which will be paid at a later date?

a) Work-in-Process Inventory 160,000, Manufacturing Overhead 5000, Wages Payable 165,000
b) Work-in-Process Inventory 165,000, Wages Payable 165,000
c) Wages Payable 165,000, Finished Goods Inventory 145,000, Work-in-Process Inventory 20,000
d) Manufacturing Overhead 165,000, Wages Payable 165,000

Answer 1

The journal entry to record the total labor charges incurred during September, which will be paid at a later date, is option a) Work-in-Process Inventory 160,000, Manufacturing Overhead 5000, Wages Payable 165,000.

Step-by-step explanation:

The journal entry to record the total labor charges incurred during September, which will be paid at a later date, would be option a) Work-in-Process Inventory 160,000, Manufacturing Overhead 5000, Wages Payable 165,000. This entry reflects the labor expenses that were incurred during the month and will be paid in the future. The debit to the Work-in-Process Inventory account represents the increase in the cost of goods being produced, while the debit to the Manufacturing Overhead account reflects the indirect wages. The credit to the Wages Payable account represents the amount owed to the employees.