Question

In a job order cost system, it would be correct in recording the purchase of raw materials to debit Finished Goods Inventory. Raw Materials Inventory. Work in Process Inventory. Work in Process and Manufacturing Overhead.

Answer 1

In a job order cost system, it would be correct in recording the purchase of raw materials to debit

Raw Materials Inventory.

Step-by-step explanation:

When materials are initially purchased, the cost is debited to the Raw materials inventory account and credited to either Cash or Accounts Payable, depending on the trade terms. When the materials are assigned to work in process, it is debited to Work in Process Inventory and to Jobs and credited to Raw materials Inventory. Finished Goods Inventory is only debited for completed jobs. Manufacturing Overhead is debited for all indirect costs.