Question

Cavy Company accumulated 590 hours of direct labor on Job 345 and 800 hours on Job 999. The direct labor was incurred at a rate of $18 per direct labor hour for Job 345 and $23 per direct labor for Job 999. Required: Journalize the entry to record the flow of labor costs into production. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for spaces or journal explanations. Every line on a journal page is used for debit or credit entries. Do not add explanations or skip a line between journal entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.

Answer 1

Answer and Explanation:

The journal entry to record the flow of labor costs into production is shown below:

Work in process Dr $29,020

To Wages payable $29,020

(Being the flow of labor cost is recorded)

Here is the computation

= 590 hours × $18 + 800 hours × $23

= $10,620 + $18,400

= $29,020

Here debited the work in process as it increased the assets and credited the wages payable as it also increased the liabilities