A Company Records Their Inventory Purchases at Standard Cost but Also

Multiple Choice

A company records their inventory purchases at standard cost but also records purchase price variances. The company purchased 5,000 widgets $8.00. The standard cost for the widgets is $7.60. Which of the following would be included in the journal entry?

A) $38,000 Debit to Accounts Payable
B) $ 2,000 Credit to Direct Materials Price Variance
C) $ 2,000 Debit to Accounts Payable
D) $ 2,000 Debit to Direct Materials Price Variance