Required Information Learning Objective 20-P3: Record the flow of production costs in process costing. Raw materlals purchases are debited to Raw materlals Inventory. Direct materlals used are debited to Work in process Inventory and credited to Raw materlals Inventory. Indirect materials used are debited to Factory overhead and credited to Raw materlals Inventory. Direct labor used is debited to Work in process Inventory and credited to Factory wages payable. Indirect labor used is debited to Factory overhead and credited to Factory wages payable. Other actual factory overhead costs are debited to Factory overhead. Estimated overhead costs are allocated, using a predetermined overhead rate, to the different processes. This allocated amount is credited to the Factory Overhead account and debited to the Work in Process Inventory account for each separate process. As units are finished, Finished goods Inventory Is debited and Work In process is credited. Units sold are debited to Cost of goods sold and credited to Finished goods inventory. Accounting for Labor Costs Knowledge Check 01 The journal entry to assign costs of direct labor used In production Includes which two of the following? (You may select more than one answer. Single cllck the box wlth the questlon mark to produce a check mark for a correct answer and double cllck the box with the question mark to empty the box for a wrong answer. Any boxes left with a questlon mark will be automatically graded as Incorrect.) Debit to Factory Wages Payable Credit to Work in Process Inventory Debit to Work in Process Inventory Credit to Cash Credit to Factory Wages Payable