Question

Rorry Company uses a job cost system. Overhead was applied to production using a rate of 78 percent of direct labor costs. What is the journal entry when direct labor costs are $18,000

Answer 1

Dr Work in Process Inventory for $14,040

Cr Manufacturing Overhead for $14,040

Step-by-step explanation:

Based on the information given we were told that the company applied Overhead to production using a rate of 78% of direct labor costs which means that the journal entry when direct labor costs are the amount of $18,000 will be :

Dr Work in Process Inventory for $14,040

Cr Manufacturing Overhead for $14,040

(78%*18,000)