The journal entry to record the purchase of direct materials includes:
A)a debit to Raw Materials Inventory.
B)a debit to Finished Goods Inventory.
C)a debit to Work in Process Inventory.
D)a debit to Cash.

Question

Quizplus · Accepted Answer

The purchase of direct materials increases the balance of Raw Materials Inventory, so a debit entry to this account is necessary. Option B, Finished Goods Inventory, would be used for finished goods that are ready to be sold, while option C, Work in Process Inventory, would apply to the cost of goods that are in the process of being manufactured. Option D, Cash, would only be debited if the purchase was made with cash.

The Journal Entry to Record the Purchase of Direct Materials