Question

during april, a small roofing company purchased 500 bundles of a certain type of shingle at a price of $20 per bundle, $5 more than the standard price. the standard quantity of this type of shingle is 550 bundles. what is the journal entry to record the issuance and usage of materials assuming that the roofing company purchased and used 500 bundles?

Answer 1

The journal entry to record the issuance and usage of materials is as follows:Debit: Materials 10,000

Credit: Cash 10,000

Explanation: The journal entry records the purchase of 500 bundles of shingles at a price of $20 per bundle. The total cost of the purchase is 500 bundles x $20 per bundle = $10,000. The debit to Materials increases the inventory of shingles, and the credit to Cash records the outflow of cash for the purchase.

An entry made directly into the main journal is referred to as a journal entry. In order to identify the accounts and amounts impacted by each transaction, a journal entry follows a standard structure. Each journal entry will have a minimum of one debit and one credit.

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