Question

Canberra Company uses a job order cost accounting system. During the current month, the factory payroll of $180,000 was paid in cash. The amount of labor classified as direct labor was three times greater than the amount classified as indirect labor. What amount should be debited to Factory Overhead for indirect labor for this month

Answer 1

$45,000

Step-by-step explanation:

Details Amount

Factory payroll in cash $180,000

Ration of Direct labor to Indirect Labor "3:1"

Total = 3 + 1 = 4

So, Indirect Labor = $180,000*1/4 = $45,000

The amount to be debited to Factory Overhead for indirect labor for this month $45,000