Question

Prepare journal entries to record the following production activities.

1. Purchased $30,000 of raw materials on credit.
2. Used $17,000 of direct materials in the Roasting department.
3. Used $21,500 of indirect materials in production.

Journal entry worksheet

• Record materials purchased on credit.

Note: Enter debits before credits.

Transaction	General Journal	Debit	Credit
1

Journal entry worksheet

• Record direct materials used in production.

Note: Enter debits before credits.

Transaction	General Journal	Debit	Credit
2

Journal entry worksheet

• Record indirect materials used in production.

Note: Enter debits before credits.

Transaction	General Journal	Debit	Credit
3

Answer 1

Solution

Transaction	General Journal	Debit	credit
1	Raw material inventory	$    30,000.00
	Accounts Payable		$        30,000.00
	(To record purchase of Raw material)
2	Work in process inventory-Roasting department	$    17,000.00
	Raw material inventory		$        17,000.00
	(To record issue of direct material)
3	Manufacturing overhead	$    21,500.00
	Raw material inventory		$        21,500.00
	(To record issue of indirect material)

Direct material and labor are debited to WIP account of respective department whereas Indirect costs are debited to manufacturing overhead account.