Fairfield Company’s payroll costs for the most recent month are summarized here:

Question

Fairfield Company’s payroll costs for the most recent month are summarized here:   

1. & 2. Prepare the journal entries for payroll and to apply manufacturing overhead to production. The company applies manufacturing overhead to products at a predetermined rate of $30 per direct labor hour. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

Journal entry worksheet

Record Fairfield Company's payroll costs to be paid at a later date.

Note: Enter debits before credits.

Item Description Total Cost Hourly labor wages 790 hours @ $15 per hour 250 hours for Job 101 = $ 3,750 340 hours for Job 102 = 5,100 200 hours for Job 103 = 3,000 $ 11,850 Factory supervision 5,250 Production engineer 7,500 Factory janitorial work 1,200 Selling, general, and administrative salaries 8,300 Total payroll costs $ 34,100

Explanation / Answer

Journal Entries :-

Transaction Particulars Debit($) Credit($) 1 Work in Process A/c Dr. 11850 Manufacturing Overhead A/c Dr.($5250+$7500+$1200) 13950 Salaries Expense A/c Dr. 8300 To Salaries and wages payable a/c 34100 (To recored the Payroll costs) 2 Work in Process A/c Dr.(790*$30) 23700 To Manufacturing overhead a/c 23700 (To record the application of manufacturing overhead)

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