When raw materials are purchased on account for use in a process costing system, the corresponding journal entry that should be recorded will include:
A) A debit to Goods in Process Inventory.
B) A debit to Accounts Payable.
C) A credit to Cash.
D) A debit to Raw Materials Inventory.
E) A credit to Raw Materials Inventory.

Question

Quizplus · Accepted Answer

When raw materials are purchased on account for use in any costing system, the purchase is recorded by debiting the Raw Materials Inventory account, reflecting the increase in inventory. The credit part of the entry typically goes to Accounts Payable, indicating the amount owed to the supplier.

When Raw Materials Are Purchased on Account for Use in a Process