Olson Corporation constructs new homes. Assume that Olson uses a job costing sys

Question

Olson Corporation constructs new homes. Assume that Olson uses a job costing system. During May 2011, the following transactions occurred:

Olson purchased $4,500 of lumber on account.

Olson used $3,750 of lumber in production and incurred 50 hours of direct labor hours at $15 per hour.

Depreciation of $1,500 on equipment used to build new houses was recorded.

A house that was completed last period at a cost of $150,000 was sold for $180,000 in cash.

Refer to Figure 5-3. The journal entry to record the requisition of lumber for Olson would include a Select one: a. debit to Work-in-Process of $4,500. b. debit to Materials Inventory of $3,750. c. credit to Finished Goods of $3,750. d. debit to Work-in-Process of $3,750. Olson Corporation constructs new homes. Assume that Olson uses a job costing system. During May 2011, the following transactions occurred:

Olson purchased $4,500 of lumber on account.

Olson used $3,750 of lumber in production and incurred 50 hours of direct labor hours at $15 per hour.

Depreciation of $1,500 on equipment used to build new houses was recorded.

A house that was completed last period at a cost of $150,000 was sold for $180,000 in cash.

Refer to Figure 5-3. The journal entry to record the requisition of lumber for Olson would include a Select one: a. debit to Work-in-Process of $4,500. b. debit to Materials Inventory of $3,750. c. credit to Finished Goods of $3,750. d. debit to Work-in-Process of $3,750. Select one: a. debit to Work-in-Process of $4,500. b. debit to Materials Inventory of $3,750. c. credit to Finished Goods of $3,750. d. debit to Work-in-Process of $3,750. a. debit to Work-in-Process of $4,500. b. debit to Materials Inventory of $3,750. c. credit to Finished Goods of $3,750. d. debit to Work-in-Process of $3,750.

Explanation / Answer

d. debit to Work-in-Process of $3,750

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