Question

Recording Factory Labor Costs The weekly time tickets indicate the following distribution of labor hours for three direct labor employees: Hours Process Job 560A Job 560B Job 5600 Improvement Eva Leavitt 22 98 Micah Stone 13 18 12 3 Travis Hendrix 10 12 12 The direct labor rate earned per hour by the three employees is as follows: Leavitt $20 Stone 22. Hendrix 18 The process improvement category includes training, quality improvement, housekeeping, and other indirect tasks.

Answer 1

Labour cost related to Job 560A, 560B and 560C will be shown as factory overhead as this is direct cost incurring for jobs.

Labour cost related to Process improvement will be shown in Work in progress.

Labour cost related to Job 560A, 560B and 560C Jobs=

Employee	Job 560A	Job 560b	Job 560c	Total Hours	Labour rate	Labour cost
Leavitt	22	9	8	39	20	780
Stone	13	18	12	43	22	946
hendrix	10	12	12	34	18	612
					total	2338

Labour cost related to Process improvement -

Employee	Hours	Labour rate	Labour cost
Leavitt	5	20	100
Stone	3	22	66
hendrix	4	18	72
		total	238

B) Cost of 560A and 560B will be as part of inventory,of finished goods while cost of 560C will be shown as part of work in progress inventory.