Jan. 4 Applied $3,624.00 of direct materials and $8120 of direct labor (time ticket No. 129) to Job No. 403, which will complete the job. The FICA rate is 7.65% of gross pay and the employees' income tax rate is 18% of gross pay. When preparing the entry for applying direct labor, debit Work in Process for the gross pay, and credit Employees' Income Tax Payable and FICA Tax Payable for the appropriate amounts and Salaries Payable for net pay.
- Remember that employees are paid on the last day of each month.
- Applied factory overhead to Job No. 403 is based upon 125% of direct labor cost.
- Transferred the completed job to the finished goods account.