The Purchase of Raw Materials on Account in a Process

question 39

Multiple Choice

The purchase of raw materials on account in a process costing system is recorded with a:

• A) Debit to Purchases and credit to Cash.
• B) Debit to Purchases and a credit to Accounts Payable.
• C) Debit to Raw Materials Inventory and a credit to Accounts Payable.
• D) Debit to Accounts Payable and a credit to Raw Materials Inventory.
• E) Debit to Goods in Process Inventory and a credit to Accounts Payable.

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Definitions:

Activities Required

The set of actions or tasks that must be performed in order to complete a specific objective or process.

On Time

The occurrence of an event or completion of a task exactly at the planned or scheduled time.

Within Budget

Pertains to expenditures or operations that do not exceed the allocated financial resources.

Fulfill Objectives

The process of achieving targeted goals or outcomes as planned or intended.