Esposito, Inc. uses a just-in-time costing system. During the month, Esposito incurred $700,000 as direct labor and $8000 as overhead. Wages were not paid. Which of the following is the correct journal entry to record the conversion costs? A. Conversion Costs 708,000 Wages Payable 708,000B. Manufacturing Overhead 708,000 Conversion Costs 708,000C. Conversion Costs 708,000 Wages Payable, Accumulated Depreciation, etc. 708,000D. Conversion Costs 708,000 Accounts Payable 708,000

Question

Business

Mireya Mcintosh

8 February, 07:53

Esposito, Inc. uses a just-in-time costing system. During the month, Esposito incurred $700,000 as direct labor and $8000 as overhead. Wages were not paid. Which of the following is the correct journal entry to record the conversion costs? A. Conversion Costs 708,000 Wages Payable 708,000B. Manufacturing Overhead 708,000 Conversion Costs 708,000C. Conversion Costs 708,000 Wages Payable, Accumulated Depreciation, etc. 708,000D. Conversion Costs 708,000 Accounts Payable 708,000

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Answers (1)

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Camryn Mccormick · Answer 1

C. Conversion Costs 708,000 Wages Payable, Accumulated Depreciation, etc. 708,000

Explanation:

The Journal entry is shown below:-

Conversion Costs Dr, 708,000

To Wages Payable, Accumulated Depreciation, etc. $708,000

(Being conversion costs is recorded)

Here to record the conversion costs we simply debited the conversion costs as it increased the expenses and we credited the Wages Payable, Accumulated Depreciation, etc. as it increased the liabilities and decreased the assets