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Unformatted text preview: 16-416-5 A raw materials requisition (request) serves several purposes:(a) It instructs the storekeeper to issue materials to particularfactory departments.(b) It transfers responsibility for materials used from thestorekeeper to production personnel.(c) It associates the cost of direct materials used with particularjobs or processes, and the cost of indirect materials used withfactory overhead.(d) It informs the company of the amount by which the Raw MaterialsInventory account should be reduced and the Goods-in-Process andFactory Overhead accounts increased.16-6 A direct material is a raw material that physically becomes part of themanufactured products. An indirect material does not physically becomepart of the manufactured product. However, for practical reasons, manyinexpensive raw materials which do become part of manufactured products(such as staples, nails, screws, glue, etc.) are treated as indirect(such as staples, nails, screws, glue, etc....
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This homework help was uploaded on 04/08/2008 for the course ACC 102 taught by Professor Drucker during the Fall '07 term at Coastal Carolina University.
- Fall '07