During January, its first month of operations, Dieker Company accumulated the following manufacturing costs: raw materials $5,500 on account, factory labor $6,400 of which $5,800 relates to factory wages payable and $600 relates to payroll taxes payable, and factory utilities payable $3,100. Prepare journal entries for each type of manufacturing cost.

See explanation

Explanation:

The journal entries for each type of manufacturing cost is prepared below:

Dr Raw material inventory $5500

Cr Account payable $5500

(To record purchase of raw material on account)

Dr Factory labor $6400

Cr Factory wages payable $5800

Cr Payroll taxes payable $600

(To record factory labor costs)

Dr Manufacturing overhead $3100

Cr Utilities payable $3100

(To record entry for utilities payable)

d. the economy will face inflation.

riley- $3

sean- $4

jake- $8

riley has the absolute advantage.