Answer:
It is obvious that company is using job order costing method. In this method all costs related to a specific job is recorded in a work in process account open for that job. Journal entries to record the transactions given in question are given below.
Time cards showing direct labor: $750
Debit WIP Major Airline $ 750
Credit Payroll Account $ 750
Time cards showing indirect labor: $100
Debit Factory overhead control account $ 100
Credit Payroll Account $ 100
Purchased repair supplies on account: $1,500
Debit WIP Major Airline $ 1,500
Credit Repair Supplies $ 1,500
Issued indirect supplies: $350
Debit Factory overhead control account $ 350
Credit Indirect supplies stock $ 350
Utilities expense on account: $24,000
Debit Factory overhead control account $ 24,000
Credit Utilities bill payable $ 24,000
Overhead applied: 100% of direct labor costs
Debit WIP Major Airline $ 750
Credit Applied Overhead Account $ 750
(100% of 750)
