The journal entry to record the direct labor summarized on the labor distribution report would include a:

Question

Quizplus · Accepted Answer

Direct labor is a cost of production and is therefore debited to the Work-in-Process Inventory account. At the same time, the company incurs a liability for the amount of direct labor cost incurred, which is credited to the Payroll Payable account. Therefore, both B (Debit to Work-in-Process Inventory) and C (Credit to Payroll Payable) are necessary entries to record the direct labor summarized on the labor distribution report.

The Journal Entry to Record the Direct Labor Summarized on the Labor