Question

.During June, Buttrey Corporation incurred $67,000 of direct labor costs and $7,000 of indirect labor costs. The journal entry to record the accrual of these wages would include a: Multiple Choice debit to Work in Process of $67,000. credit to Work in Process of $74,000. NO debit to Work in Process of $74,000. NO credit to Work in Process of $67,000. NO

Answer 1

Answer: Debit to Work in Process of $67,000

Explanation:

Direct Labor costs incurred when producing are sent to the Work in Progress account to show that they were direct costs in the making of a product and so should be included in the cost of the good.

They are debited to the Work in Progress account and credited to the Wages Payable account.

From the above, the direct Labor costs are $67,000 and so this will be debited to the WIP account.