The recording of direct labor will result in a:Multiple choice question.debit to Work in Process Inventory and credit Factory Wages Payabledebit to Factory Overhead and a credit Work in Process Inventorydebit to Work in Process Inventory and a credit Factory Overheaddebit to Factory Wages Payable and a credit to Work in Process Inventory
Question
The recording of direct labor will result in a:Multiple choice question.debit to Work in Process Inventory and credit Factory Wages Payabledebit to Factory Overhead and a credit Work in Process Inventorydebit to Work in Process Inventory and a credit Factory Overheaddebit to Factory Wages Payable and a credit to Work in Process Inventory
Solution
The correct answer is "debit to Work in Process Inventory and credit Factory Wages Payable".
Here's why:
When direct labor is recorded, it is considered as a part of the cost of the goods that are in the process of being manufactured. Therefore, it increases the Work in Process Inventory, which is an asset account. This increase in an asset account is recorded as a debit.
On the other hand, the company owes wages to its factory workers for the work they have done. This is a liability for the company and is recorded in the Factory Wages Payable account. An increase in a liability account is recorded as a credit.
So, the recording of direct labor will result in a debit to Work in Process Inventory (increase in assets) and a credit to Factory Wages Payable (increase in liabilities).
Similar Questions
The journal entry to record the allocation of factory overhead to work in process is:Multiple choice question.debit Work in Process Inventory and credit Cashdebit Cash and credit Factory Overheaddebit Work in Process Inventory and credit Factory Overheaddebit Factory Overhead and credit Work in Process Inventory
True or false: The journal entry to record the use of direct labor includes a debit to factory wages payable and a credit to work in process inventory.True false question.TrueFalse
Multiple Choice QuestionThe journal entry to record indirect materials in production is to:Multiple choice question.debit Factory Overhead and credit Raw Materials Inventorydebit Work in Process Inventory and credit Factory Overheaddebit Raw Materials Inventory and credit Work in Process Inventorydebit Work in Process Inventory and credit Raw Materials Inventory
Since manufacturing costs (direct materials, direct labor, and overhead) are incurred in the process of manufacturing units of product, these costs are recorded in entries that include debits to:Multiple ChoiceThe Direct Materials Inventory, Direct Labor, and Manufacturing Overhead accounts.Expense accounts.The Work in Process Inventory account.
Choose the best answer A credit to Work in Process Inventory represents Group of answer choices raw material put into production. work still in process. the transfer of completed items to Finished Goods Inventory. the application of overhead to production.
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