Edwards Company produces calendars in a one-department process. The following information is available:
The units still in process are 100 percent complete with respect to direct materials and 60 percent complete with respect to conversion costs.
-In process costing, the journal entry to record direct materials used would include a
A) credit to Direct-Materials Inventory.
B) debit to Cost of Goods Sold.
C) credit to Work-in-processDepartment Name.
D) debit to Finished Goods.

Question

Edwards Company produces calendars in a one-department process. The following information is available:
  The units still in process are 100 percent complete with respect to direct materials and 60 percent complete with respect to conversion costs.
-In process costing, the journal entry to record direct materials used would include a
A) credit to Direct-Materials Inventory. 
B) debit to Cost of Goods Sold. 
C) credit to Work-in-processDepartment Name. 
D) debit to Finished Goods.

Quizplus · Accepted Answer

In process costing, the direct materials used are recorded as a debit to Work-in-processDepartment Name and a credit to Direct Materials Inventory. This is because the materials are still in process and have not yet been transferred to finished goods or sold, therefore, they are still in the inventory account.

Edwards Company Produces Calendars in a One-Department Process