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

---

Definitions:

Direct Contribution

Direct contribution refers to the specific, measurable impact that an individual or activity has on the achievement of an organization’s objectives or on the completion of a project.

Line Managers

Managers who have direct responsibility over a specific department or team, involved in day-to-day operations and personnel management.

Organisation's Product

The result of a company's efforts, whether it's a tangible good, service, or digital offering, created to fulfill customer needs.

Small Work Group

A limited number of individuals assembled to perform tasks or achieve specific goals, characterized by close interaction and collaboration.