The journal entry to record the requisition of indirect materials from the raw materials storeroom and the transfer of the materials to the factory would include a:
A)credit to Cost of Goods Manufactured
B)debit to Work-in-Process Inventory
C)debit to Manufacturing Overhead
D)credit to Accounts Payable

Question

Quizplus · Accepted Answer

Indirect materials are not directly used in the production process, but they are still necessary for production. Therefore, the cost of indirect materials is charged to manufacturing overhead. Thus, the correct entry would include a debit to manufacturing overhead for the cost of the indirect materials requisitioned from the raw materials storeroom. There would not be a credit to Cost of Goods Manufactured, as this account is used to track the cost of finished goods produced, not indirect materials. There would not be a debit to Work-in-Process Inventory, as this account tracks the cost of direct materials and direct labor used in the production process, not indirect materials. Lastly, there would not be a credit to Accounts Payable, as this entry does not involve a payment to a supplier.

The Journal Entry to Record the Requisition of Indirect Materials