A company that uses a job order costing system would make the following entry to record the flow of direct materials into production:
A)debit Work in Process Inventory,credit Cost of Goods Sold.
B)debit Work in Process Inventory,credit Raw Materials Inventory.
C)debit Work in Process Inventory,credit Factory Overhead.
D)debit Factory Overhead,credit Raw Materials Inventory.
E)debit Finished Goods Inventory,credit Raw Materials Inventory.

Question

Quizplus · Accepted Answer

A job order costing system tracks the direct materials, direct labor, and overhead costs associated with producing specific products or jobs. In this system, raw materials inventory is debited when materials are purchased, and when materials are used in production, the work in process inventory account is debited while the raw materials inventory account is credited. Therefore, choice B is the correct option.

A Company That Uses a Job Order Costing System Would