Applied 3624.00 of direct materials (requistion no. 679) and 8,120.00 of direct

Question

Applied 3624.00 of direct materials (requistion no. 679) and 8,120.00 of direct labor (time ticket no. 129) to Jo no. 403, which will complete the job.) The FICA rate is 7.65% of gross pay and the employees income tax rate is 18% of gross pay. When preparing the entry applying direct labor. debit Work in Process for the gross pay, and credit Employees; Income Tax Payable and FICA Tax payable for the appropriate amounts and Salaries Payable for net pay.

I am not sure how to jornalize this ? Then it says Employees are pain on the last day of each month and I am to apply factory overhead to job no. 403 is based upon 125% of direct labor cost.

Explanation / Answer

DR Work In Process 3624.00 CR Direct Materials 3624.00 DR Work in process 8120.00 CR Salaries Payable 6037.22 CR Income tax Payable 1461,60 CF FICA Tax Payable 621.18 DR Work in process- factory overhead 10,150 (8120*1.25) CR Overhead applied 10,150 DR Salaries Payable 6037.22 CR Cash 6037.22

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