Cost and Management AccountingQuestion 5450 of 251
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12. A company which operates a batch costing system is fully integrated with the financial accounts. During a particular period materials worth ` 30,000 and ` 20,000 were issued to production and Factory Maintenance respectively. The following control A/cs are being maintained. (i) Store ledger control A/c. (ii) Work-in-progress control A/c. (iii) Production overhead control A/c. (iv) Finished goods control A/c. From the above information, identify which account/accounts will be debited to effectuate the issuance of materials:

Options

A(i) & (ii)
B(ii) & (iii)
C(ii) & (iv)
DOnly (i)
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Correct Answer

Option A(i) & (ii)

All Options:

  • A(i) & (ii)
  • B(ii) & (iii)
  • C(ii) & (iv)
  • DOnly (i)

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Detailed Solution & Explanation

In an integrated accounting system, when materials are issued to production, the Work-in-Progress (WIP) Control Account is debited and the Stores Ledger Control Account is credited:
Debit: Work-in-Progress Control Account\text{Debit: Work-in-Progress Control Account}
Credit: Stores Ledger Control Account\text{Credit: Stores Ledger Control Account}
As per the official answer key, the correct option is (i) & (ii).
Hence, **Option A** is the correct answer.

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