This is a great work-around. But, I could use a bit more guidance on including other costs, like labor and other overhead.

I'm imagining a scenario like this:

Buy Labor (that will eventually be a direct cost of assembly)

Payroll Expense: debit + cost of labor

Bank: debit - cost of labor

Use Labor in Production

WIP bank: debit + cost of labor

CONFUSION (retained earnings? income account? Payroll Expense?) 

I don't want to take away from my payroll expense and put it in WIP, as the bosses like to see how much we spend on that kind of thing. 

I am tempted to credit Retained Earnings, but maybe an income account would be better for including the cost of labor in the WIP?

Apologies if I've gone in a completely wrong direction.