Asked by Kathy Garcia on Jul 16, 2024
Verified
When recording the raw materials purchases in transaction (a) above, the Raw Materials inventory account will increase (decrease) by:
A) $1,366,200
B) $1,472,460
C) ($1,366,200)
D) ($1,472,460)
Raw Materials Inventory
The stock of basic materials and components that are to be used in the production or manufacturing of goods.
- Gain an understanding of how transactions for raw material purchases are recorded in both the Raw Materials Inventory and Cash accounts.
Verified Answer
RT
Raynald ThomasJul 20, 2024
Final Answer :
A
Explanation :
Raw Materials increases by the standard cost of the raw materials purchased, which is AQ × SP = 151,800 kilos × $9.00 per kilo = $1,366,200
Learning Objectives
- Gain an understanding of how transactions for raw material purchases are recorded in both the Raw Materials Inventory and Cash accounts.
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