Entries for Direct Labor and Factory Overhead Townsend Industries Inc. manufactu

Question

Entries for Direct Labor and Factory Overhead Townsend Industries Inc. manufactures recreatlonal vehldles. Townsend uses a job order cost system. The time tickets from November jobs are summarized as follows ob 201 Job 202 Job 203 Job 204 Factory supervislon Factory overhead Is applied to jobs on the basis of a predetermined overhead rate of $26 per direct labor hour. The direct labor rate Is $13 per hour If required, round final answers to the nearest dollar a. Journalize the entry to record the factory labor costs. If an amount box does not require an entry, leave It blank. $2,320 1,160 920 1,710 790 Work in Process Factory Overhead 790 Wages Payable 6,900 Foodhack Chack My Wark b. Jrnalize the entry to apply factory overhead to production for November Work in Process 18 X Factory overhead 18 X

Explanation / Answer

Journal Entry Date Particulars Dr. Amt. Cr. Amt. . a. Work in Process      6,110.00 Factory Overhead          790.00    Wages Payable      6,900.00 (To record the factory labor costs) b. Work in Process    12,220.00    Factory Overhead    12,220.00 (To record the factory overhead applied) Direct Labor Hours = $6,110 (Labor Costs) / $13 (Direct Labor Rate per hour) Direct Labor Hours = 470 hours Factory Overhead Applied = $26 (Predetermined Overhead Rate) X 470 DLH Factory Overhead Applied = $12,220

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