Clarksen Company uses a process costing system. The company requisitioned $93,000 of materials for Department A and $67,000 of materials for Department D. The entry to record the use of the direct materials by these two departments is: Multiple Choice Debit Raw Materials Inventory $160,000; credit Accounts Payable $160,000. Debit Work in Process Inventory-Dept. A $93,000; debit Work in Process Inventory-Dept. D $67,000; credit Raw Materials Inventory $160,000. Debit Factory overhead $160,000; credit Raw Materials Inventory $160,000. Debit Raw Materials Inventory-Dept. A $93,000; debit Raw Materials Inventory-Dept. D $67,000; credit Work in Process Inventory $160,000. Debit Work in Process Inventory-Dept. A $93,000; debit Work in Process Inventory-Dept. D $67,000; credit Accounts Payable $160,000.

Question

Yasmin Brady

Business

27 April, 03:21

Clarksen Company uses a process costing system. The company requisitioned $93,000 of materials for Department A and $67,000 of materials for Department D. The entry to record the use of the direct materials by these two departments is: Multiple Choice Debit Raw Materials Inventory $160,000; credit Accounts Payable $160,000. Debit Work in Process Inventory-Dept. A $93,000; debit Work in Process Inventory-Dept. D $67,000; credit Raw Materials Inventory $160,000. Debit Factory overhead $160,000; credit Raw Materials Inventory $160,000. Debit Raw Materials Inventory-Dept. A $93,000; debit Raw Materials Inventory-Dept. D $67,000; credit Work in Process Inventory $160,000. Debit Work in Process Inventory-Dept. A $93,000; debit Work in Process Inventory-Dept. D $67,000; credit Accounts Payable $160,000.

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Answers (1)

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Felicity Whitehead · Answer 1

The correct journal entries should be:

Department A:

Dr Work in progress inventory 93,000

Cr Raw materials inventory 93,000

Department D:

Dr Work in progress inventory 67,000

Cr Raw materials inventory 67,000

Explanation:

Raw materials is an asset account with a debit balance, and since we must decrease it, we have to credit the amounts. Work in progress (WIP) inventory is an asset account so it has a debit balance.