Journalizing Pattern

• Purchase direct material

  raw material inventory

  cash or accounts payable
• Use direct material

  Work in process inventory

  raw material inventory
• Direct Labor incurred

  Direct Labor

  Withholding tax payable

  payroll payable
• Record application of Direct Labor to Production

  Work in process

  Direct Labor
• Payment of direct labor

  Withholding tax payable

  payroll payable

  cash
• Incurred factory overhead cost

  Factory Overhead

  cash or accounts payable
• application of Factory overhead

  work in process inventory

  applied factory overhead
• When production is completed

  Finished goods inventory

  Work in process inventory