Question

Guardino Company manufactures a single product by a continuous process, involving three production departments. The records indicate that direct materials, direct labor, and applied factory overhead for Department 1 were $100,000, $125,000, and $150,000 respectively. The records further indicate that direct materials, direct labor, and applied factory overhead for Department 2 were $50,000, $60,000, and $70,000 respectively. In addition, work in process at the beginning of the period for Department 1 totaled $75,000 and work in process at the end of the period totaled $60,000.
The journal entry to record the flow of costs into Department 2 during the period for direct labor is:_______

Answer 1

Answer:

Department 2

Work In Process $60,000 (debit)

Salaries and Wages Payable / Cash $60,000 (credit)

Explanation:

Manufacturing Costs are accumulated in the Work In Process Account during Manufacture.

Recognize the Manufacturing Expense and also recognize a liability if the Salaries are still owing or Cash if the Labor costs have been paid up.