During the current month, Wacholz Company incurs the following manufacturing costs. a. Purchased raw materials of $18,000 on account.
b. Incurred factory labor of $40,000. Of that amount, $31,000 relates to wages payable and $9,000 relates to payroll taxes payable.
c. Factory utilities of $3,100 are payable, prepaid factory property taxes of $2,700 have expired, and depreciation on the factory building is $9,500.

Required:
Prepare journal entries for manufacturing costs.

Answer and Explanation:

The journal entries are shown below:

a. Raw material inventory Dr $18,000

              To Account payable $18,000

(Being raw material purchase as on account)

b. Factory labor expense $40,000

          To Wages payable $31,000

          To Payroll tax payable $9,000

(Being factory labor expense is recorded)

c. Manufacturing overhead Dr $15,300

             To Utilities payable $3,100

             To Prepaid factory property tax $2,700

             To Accumulated depreciation - factory building $9,500

(being manufacturing overhead is recorded)

the answer is     d. in our global economy, most job growth will be in services, but manufacturing jobs will exist, too.