Question

Entries for Direct Labor and Factory Overhead Schumacher Industries Inc. manufactures recreational vehicles. Schumacher Industries uses a job order cost system. The time tickets from June jobs are summarized as follows: Job 11-101 $4,640 Job 11-102 5,510 Job 11-103 6,612 Job 11-104 12,760 Job 11-105 18,270 Factory supervision 12,500 Factory overhead is applied to jobs on the basis of a predetermined overhead rate of $23 per direct labor hour. The direct labor rate is $29 per hour. a. Journalize the entry to record the factory labor costs. If an amount box does not require an entry, leave it blank

Answer 1

Work In Process : Job 11-101 $4,640 (debit)

Work In Process : Job 11-102 $5,510 (debit)

Work In Process : Job 11-103 $6,612 (debit)

Work In Process : Job 11-104 $12,760 (debit)

Work In Process : Job 11-105 $18,270 (debit)

Work In Process : Indirect labor $12,500 (debit)

Salaries Payable $60,292 (credit)

Step-by-step explanation:

The factory labor consist of direct labor and indirect labor and all are accounted in the work in process account.

Direct labor can be traced directly to the job being manufactured.

Whilst indirect labor can not be traced directly to the job being manufactured example is factory supervisor`s salary.