ABC produces ping-pong balls using a three-step process that includes molding, colouring and finishing. Which of the following accounts is credited for direct labour used during the molding process?

Question

Quizplus · Accepted Answer

Direct labour used during the molding process would be credited to wages payable, as this account records the wages owed to employees for their direct labour hours worked. WIP inventory-molding is an inventory account and would not be credited for labour costs. Manufacturing overhead is not directly related to direct labour costs. Raw materials inventory is not related to direct labour costs, but rather to the cost of materials used in production.

ABC Produces Ping-Pong Balls Using a Three-Step Process That Includes