Nelson Manufacturing has two processing departments,Department I and Department II.The raw materials processed at Department I are sent to Department II for further processing.During June,direct materials worth $40,000 purchased on account were assigned to Department I.The journal entry to record direct materials used in production is ________.
A) debit Work-in-Process Inventory-Department I, $40,000; credit Raw Materials Inventory, $40,000
B) debit Raw Materials Inventory, $40,000; credit Work-in-Process Inventory-Department I, $40,000
C) debit Work-in-Process Inventory-Department I, $40,000; credit Accounts Payable, $40,000
D) debit Accounts Payable, $40,000; credit Work-in-Process Inventory-Department I, $40,000

Question

Quizplus · Accepted Answer

The correct journal entry to record the use of direct materials in production is to debit the Work-in-Process Inventory for the department using the materials (in this case, Department I) and credit the Raw Materials Inventory. This reflects the movement of $40,000 worth of materials from raw materials inventory into work-in-process as they are used in production.

Nelson Manufacturing Has Two Processing Departments,Department I and Department II