When the Actual Price to Purchase a Raw Material on Account

question 19

Multiple Choice

When the actual price to purchase a raw material on account exceeds its standard price, the journal entry would include:

• A)Debit to Raw Materials; Credit to Materials Price Variance
• B)Debit to Accounts Payable; Credit to Materials Price Variance
• C)Debit to Raw Materials; Debit to Materials Price Variance
• D)Debit to Accounts Payable; Debit to Materials Price Variance

Grasp the basis of accounting methods: cash and accrual.

Relate the matching principle to the preparation of accurate financial statements.

Differentiate between various types of adjusting entries (e.g., prepayments, accruals, depreciation).

Identify the classifications and normal balance of specific accounts (Prepaid Insurance, Unearned Fees, Supplies Expense, Accumulated Depreciation).

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Definitions:

Ignoring

Ignoring involves deliberately paying no attention to something or someone, often as a response to behavior deemed undesirable.

Performance Reviews

Evaluations of an employee's work performance over a specific period of time, typically conducted by their supervisor.

Performance Reviews

Formal assessments in which the job performance of an employee is documented and evaluated, often leading to recommendations for improvement or promotion.

Terminating An Employee

The process of formally ending the employment of a worker, typically due to performance issues, organizational changes, or misconduct.