Question

During the current month, Wacholz Company incurs the following manufacturing costs.

Answer 1

Answer:

(a) Dr Raw material 18,500

Cr Account payable 18,500

(b) Dr Factory labor 38,900

Cr Factory wages payable 30,700

Cr Factory employer taxes payable 8,200

(c) Dr Manufacturing overhead 15,100

Cr Utilities payable 3,000

Cr Prepaid property taxes 3,000

Cr Accumulated depreciation-Building 9,100

Explanation:

Preparation of the journal entries for each type of manufacturing cost.

(a) Preparation of the journal entry for the Purchases of raw materials on account

Dr Raw material 18,500

Cr Account payable 18,500

( To record purchase raw material)

(b) Preparation of the journal entry To record factory labor costs

Dr Factory labor 38,900

Cr Factory wages payable 30,700

Cr Factory employer taxes payable 8,200

(To record factory labor)

(c) Preparation of the journal entry To record overhead costs

Dr Manufacturing overhead 15,100

(3,000+3,000+9,100)

Cr Utilities payable 3,000

Cr Prepaid property taxes 3,000

Cr Accumulated depreciation-Building 9,100

(To record overhead)