Question

Esposito, Inc. uses a just-in-time costing system. During the month, Esposito incurred $700,000 as direct labor and $8000 as overhead. Wages were not paid. Which of the following is the correct journal entry to record the conversion costs?A.Conversion Costs 708,000 ​Wages Payable ​ 708,000B.Manufacturing Overhead 708,000 ​Conversion Costs ​ 708,000C.Conversion Costs 708,000 ​Wages Payable, Accumulated Depreciation, etc. 708,000D.Conversion Costs 708,000 ​Accounts Payable ​ 708,000

Answer 1

C.Conversion Costs 708,000 ​Wages Payable, Accumulated Depreciation, etc. 708,000

Step-by-step explanation:

The Journal entry is shown below:-

Conversion Costs Dr, 708,000 ​

To Wages Payable, Accumulated Depreciation, etc. $708,000

(Being conversion costs is recorded)

Here to record the conversion costs we simply debited the conversion costs as it increased the expenses and we credited the Wages Payable, Accumulated Depreciation, etc. as it increased the liabilities and decreased the assets