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The gross earnings of the factory workers for Larkin Company during the month of January are $90,000. Of the total accumulated cost of factory labor,
The gross earnings of the factory workers for Larkin Company during the month of January are $90,000. | |||||
Of the total accumulated cost of factory labor, 85% is related to direct labor and 15% is attributable to indirect labor. | |||||
Instructions | |||||
(a) | Record the factory labor costs for the month of January. | ||||
(b) | Assign the factory labor to production. | ||||
NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?" . | |||||
(a) and (b) | Record the factory labor costs for the month of January. | ||||
Manufacturing Costs | Work in Process Inventory | ||||
Raw Materials Inventory | Factory Labor | Manufacturing Overhead | |||
(a) Incurred factory labor | Value | ||||
(b) Direct labor | ? | ? | |||
(b) Indirect labor | ? | ? | |||
Balances | Value | Value | Value | ||
After you have completed E12-1, consider the following additional question. | |||||
Assume that factory wages changed changed to $78,000. | |||||
Also assume that 80% of total labor costs is related to direct labor. Revise the assignment | |||||
of factory labor to production. | |||||
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