Which of the following is/are not true regarding the Raw Materials Inventory account?
A)The Raw Materials Inventory account includes the cost of raw materials purchased but not yet transferred to the factory floor.
B)The merchandising firm records purchases of raw materials as debits to the Raw Materials Inventory account.
C)When the manufacturer physically transfers raw materials to the factory floor, it also transfers the cost of the raw materials from the Raw Materials Inventory account to the Work-in-Process Inventory account.
D)When the manufacturer physically transfers raw materials to the factory floor, it records this transfer as a credit to the Raw Materials Inventory account for the cost of the raw materials transferred and a debit to the Work in Process Inventory account.
E)all of the above

Question

Quizplus · Accepted Answer

The Raw Materials Inventory account is used by manufacturers to record the cost of raw materials purchased but not yet transferred to the factory floor. However, a merchandising firm would not have a Raw Materials Inventory account as they do not manufacture products. Instead, they would record purchases of inventory as debits to an inventory account specific to the type of inventory they sell, such as a Merchandise Inventory account.

Which of the Following Is/are Not True Regarding the Raw