Question

During May, Keenan Company accumulated 570 hours of direct labor costs on Job 200 and 610 hours on Job 305. The total direct labor was incurred at a rate of $20 per direct labor hour for Job 200 and $23 per direct labor hour for Job 305. Journalize the entry to record the flow of labor costs into production during May.

Answer 1

Answer:

Dr work-in process $ 25,430.00  

Cr wages payable                            $ 25,430.00  

Explanation:

The total labor cost on jobs is the total hours spent on each job multiplied by direct labor cost per hour as shown thus:

Job 200=570*$20=$11,400.00  

Job 305=610*$23=$14,030.00  

Total direct labor cost on both jobs=$11,400.00  +$14,030.00 =$ 25,430.00  

The journal entries in respect of labor cost of  $25,430.00  is to debit work-in process and again a credit goes to wages payable