Question

Andrew Industries purchased $165,000 of raw materials on account during the month of March. The beginning Raw Materials Inventory balance was $22,000, and the materials used to complete jobs during the month were $141,000 of direct materials and $13,000 of indirect materials. What journal entry should Andrew use to account for direct materials used in March?

Answer 1

Answer:

WIP            141,000 debit

overhead    13,000 debit

    Raw materials Inventory    154,000 credit

Explanation:

beginning 22,000

Purchase 165,000

used for job 141,000 this amount is work in process

indirect materials 13,000 this is actual overhead.

the entry will divide the raw materials base on their destination.

WIP            141,000

overhead    13,000

    Raw materials Inventory    154,000