Question

A company uses a standard costing system, and the standard cost of materials is $5 per...

  1. A company uses a standard costing system, and the standard cost of materials is $5 per pound. The company buys 1,000 pounds of materials at $5.15 per pound on account.
    1. Record the purchase of the materials:

b The assembly department in the company’s process costing system requisitions 700 pounds of materials. Record the journal entry

Business   Accounting   
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Answer #1

Journal entries are as follows:

Date Account and Explanation Debit ( $) Credit( $ )
    a) Raw Material Inventoy (1000 * $5.15)          5,150
              Account Payable          5,150
(Recorded the raw material inventoy)
    b) Work In- Process (WIP) - Assembly (700 * $5.15)          3,605         3,605
         Raw Material Inventoy
(Recorded the requisitions of raw material Inventory)
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