Question

Which of the following entries correctly reflects the entry for recording the wages of all factory workers?

a. Work in Process Inventory Wages Expense Cash
b. Work in Process Inventory Manufacturing Overhead Wages Payable
c. Wage Expense Work in Process Inventory
d. Direct Labor Expense Indirect Labor Expense Wages Payable

Answer 1

Answer; b. Work in Process Inventory Manufacturing Overhead Wages Payable

Explanation;

Factor workers are considered to be directly related to the production of the good. As a result, the wages paid to them are added to the inventories produced to show that they are part of the cost of the goods produced. Their wages will therefore be debited to Work in Process Inventory.

The wages will then be credited to the Manufacturing Overhead Wages Payable as this is the liability account that deals with wages owed to people working in the factory.