Question

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

Answer 1

Answer: The purchase of raw materials on account in a process costing system is recorded with a "C. Debit to Raw Materials Inventory and a credit to Accounts Payable.".

Explanation: The purchase of raw materials must reflect an increase in the inventory of raw materials and an increase in the liability generated by the purchase on account.