Entry for Factory Labor Costs

The weekly time tickets indicate the following distribution of labor hours for three direct labor employees:

Hours
	Job 301		Job 302		Job 303		Process Improvement
Landon Vincent	21		13		7		2
Fahad Hamad	11		15		11		3
Ivory Argo	13		17		12		5

The direct labor rate earned per hour by the three employees is as follows:

Landon Vincent	$16
Fahad Hamad	24
Ivory Argo	20

The process improvement category includes training, quality improvement, and other indirect tasks.

a. Journalize the entry to record the factory labor costs for the week. If an amount box does not require an entry, leave it blank.

	Accounts PayableAccounts ReceivableCashWages PayableWork in ProcessWork in Process	Work in Process	Work in Process
	Accounts PayableAccounts ReceivableCashFactory OverheadWages PayableFactory Overhead	Factory Overhead	Factory Overhead
	Accounts PayableAccounts ReceivableFactory OverheadWages PayableWork in ProcessWages Payable	Wages Payable	Wages Payable

b. Assume that Jobs 301 and 302 were completed but not sold during the week and that Job 303 remained incomplete at the end of the week. How would the direct labor costs for all three jobs be reflected on the financial statements at the end of the week?

The direct labor costs for the completed jobs would become part of the

finished goods inventorywork in process inventorycost of goods sold

. The direct labor costs for Job 303 would be remain part of the

finished goods inventorywork in process inventorycost of goods sold

.