If $20,000 Direct Materials Are Requisitioned for a Job and $7,000

question 70

Short Answer

If $20,000 direct materials are requisitioned for a job and $7,000 of indirect materials are requisitioned for general use, the debit to Work In Process Inventory should be for $______________.

---

Definitions:

Historical Cost

The original monetary value of an asset or transaction, based on the actual amount paid or incurred at the time of acquisition, without adjusting for inflation or changes in market value.

Carrying Value

The book value of assets and liabilities as represented on the balance sheet, considering factors like depreciation or amortization.

Recoverable Amount

The recoverable amount is the greater value between an asset's net selling price and its value in use, indicating the potential value that can be recovered from an asset over time.

Impairment Loss

A reduction in the recoverable amount of a fixed asset or goodwill below its book value, recognized as an expense in the income statement.