CAF-5 · Chapter 6 · Question 5 of 10
If materials are issued from the store to be used as general maintenance supplies on the factory floor (indirect materials) rather than for a specific job, what is the correct journal entry?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) Debit: Production Overhead Control / Credit: Materials Control
Explanation
Indirect materials cannot be traced to a specific job. Therefore, when they are issued, they are debited to the Production Overhead Control account instead of the WIP account.
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