 You know the department didn't give us there and maybe they didn't have but warehouse didn't have all we need And then we usually have it filled out by because we want to be able to track an audit trail that we have here and then And we've got the date that the materials description the plank of wood. This is the requester And this is filled by so obviously we want to have the two individuals We want to have someone requesting one one filling it out that gives us a system of controls meaning It would be difficult to steal the plank of wood if we have to have two people involved in the requisition process Without having some type of collusion in order for that to happen date provided and Material received date and any remarks that we might have so this would just be the form Just just a form for us to get that wood From the warehouse to the working process so we can start working on it And remember that all ties out to to this form as well So this requisition form is going to be used here on the on the Material side to get the materials out of there And it's also going to be used on the supporting document not that this isn't the actual form We'll see here, but it'll also be used in this document, which is the job cost So we're moving the materials then over here to the to the job cost system so we're still have our our job job 15 and we're going to allocate this requisition form to it and That will that will mean that we're still tracking the wood. It's still there It hasn't left the company because we haven't sold it yet but now we're tracking it in the account of work in process and that account is not supported by us Tracking the inventory and just planks of wood. It's supported by our job cost sheets So our job cost sheets are now supporting that piece of inventory And we're gonna have it in this job cost sheet up until it's finished And then we'll have the job will move to finished goods and it'll still be supported by this job cost sheet And then we'll finally sell it and once we sell it Well, we'll then move this all these costs all these inventory that we bought And you know all the material we bought all the labor we did all the overhead We'll then be finally expensed in the form of cost of goods sold at the point of sale Now we'll take a look at a journal entry related to the materials requisition So every time we have a materials requisition, we're gonna have a journal entry for it for the general ledger accounts Here we're gonna say for all these different jobs So we're looking at all these jobs and we had all these requisitions for these jobs we're gonna sum up those requisitions so we're just taking these documents and summing up the materials that were requested and that's gonna come up to total of 2230 so the journal entry then we will have is gonna be the raw materials going down the raw materials here are Going down and then it's gonna be moved to the work in process account So raw materials is an asset account. It has a debit balance We're moving it from the raw materials from the warehouse So that's gonna decrease and we're gonna move it not too far to another inventory account to work in process So work in process is an inventory account. It's an asset account. It represents the inventory. We're working on it's gonna be increased Now that's gonna be for the direct materials those that we can apply directly out to the Guitars if we're making guitars now There also might be some materials that are indirect meaning something like glue or something like that if we're making guitars And if we say that there was requests for for glue or something like that That was indirect that we couldn't have signed to a job We didn't know job applied it We just are basically taking stuff from the warehouse and assigning it just in general to be in the where we just gave him Glue they can be assigned to anybody who wants to use it in the middle on any guitar That they start to work on then we don't know what's job to apply it to here And so those may still come out of just the materials. We might still have just Materials that will be there or we might try to track those types of materials separately So in other words, we might have a materials account that includes all materials direct and indirect Or we might try to have another account just just has the indirect stuff and Track those separately in this case. We're gonna say they're all in raw materials And then the indirect materials we're gonna say okay that raw materials is going down by 550 and The debits not going to work in process why because we don't know which job to assign it to it Just went into the warehouse and anybody who's making a guitar either any of these jobs that are working on a guitar Can use the material so that means that we we can't assign it yet We can't put it to work in process because we cannot support it. We can't back it up by particular jobs So therefore we're gonna put it into the bucket Factory overhead it's still kind of an asset because ultimately it's gonna go into the Work in process. It's just that we're gonna have to assign it to a job first We're just gonna put all the stuff into a bucket and then find some way to assign it to a job So if we look at those journal entries, then we're gonna post out the work in process started at zero It's gonna go up by two thousand two hundred two two thousand two hundred and you can see that work in process Then it's here on the trial balance and then the raw materials Here's the general ledger for my raw materials. It was at one thousand five hundred one hundred fifty thousand It's going down with a credit two thousand two thirty two one forty seven seven seventy So we just moved it from raw materials to work in process. And then this side factory overhead Went from zero up by five hundred fifty. So here's the factory overhead at five hundred fifty and Then the raw materials gonna go down again. So raw materials 147 770 going down by 550 to 147 220 and that then is gonna be the 147 220 So so yeah, I was 147 770 before now it's down to the 147 220 that's represented here on the trial balance after both of these have been completed Note that none of this this whole process is not doing anything to the income statement We bought the materials. We were starting to use the materials never gonna hit the income statement Never affecting that income until when they're gonna affect net income when we're finally done We move these from work in process to finished goods and then we move them from finished goods to actually selling them Moving them to cost of goods sold Now that we will sell it sales will increase at the same time at that point But what we're working on is the cost of goods sold that will will ultimately be the cost So all the stuff we're doing here is just kind of shuffling around on balance sheet accounts Just shuffling around basically an inventory asset type of counts to track this process as it goes through and being able to support the process with job cost sheets