 this is going to be an example of a materials ledger card and you can note that it's going to look very similar to us tracking inventory. We're basically tracking the inventory of materials. So if you work with a merchandising company, a company that purchases and sells inventory, we'll have a similar kind of tracking system that we might use for the tracking of inventory. In this case, of course, we're using it for one component of inventory, one component of in this case, the type of services or the type of inventory that we make. So if we make guitars, for example, the major component might be wood. And so we would have to track that major component in a similar way that we would have to track the entire units of inventory for a merchandising company. So we might have things like on the inventory items. In this case, we're going to say it's the wood planks. We might have a stock number, we might have a location in the store room. If we have a large store room, maximum quantity, minimum quantity and quantity to reorder a reorder point when we want to reorder. And then we're going to break this out then to the received, issued, and balance. So this means received, like we purchased it and we have received it. So this is when we're getting the inventory issued would be similar to our sales type of item or their cost of goods sold if we were a merchandising company. In this case, we're not selling it, it's not leaving the company. It's going to another department, it's going from our warehouse basically to the production department to the factory to the work in process. And then we're going to have the balance here, which is going to be what we what is kind of on the balance sheet as of the ending product. So if we think of the balance sheet, this is going to be what is still included in our inventory items of just raw material. And then we might be tracking this information. For example, on March 4, we said we had received. So we have a receiving report. This is going to be the documentation we might use in a large company to tie this out to the receiving report. So in other words, this came from a receiving report. The warehouse would have received this information counted it. We have then the receiving report two units, and then we're going to have the unit price 225. And then the total price is the two units times the 225 or 450. Now, if we bring this over to the balance, we started with one unit at 225 or 225. And now we're bringing over this two units. So now we've got the two units and the one unit or of course, three units, they still all cost 225. And therefore three times the 225 means we have a total of 675. So as of March 4, we have $675 worth of inventory for wood planks. And then we're saying this time we have an issuance on March 7. We had an issuance. Why would we issue? Well, there was a request from the working process for say there's a new guitar we need to make and they ordered some planks of wood, one plank of wood apparently. And we then have a requisition form. That's going to be the form from the working process, the factory saying hey, we've got a project that we need to work on. Here's the form. We're going to say that's for one unit, one plank cost 225. Notice this isn't the sales price. We're not dealing with any sales as all internal purchasing going from one department to another now to work in process to the factory. Here's the total. If we go to the balance then we had three units. We just issued one from the warehouse. So how many are left in the warehouse? Only two times the 225 and that gives us the 450. Now a couple of things to note here. Note that obviously you might think, well, wait, we still have three units because it only went from one department to the other. And that's true. But we're not going to be tracking it here in working process. Now it's not going to be included in the balance sheet account of materials. It's going to be included in the balance sheet account of work in process. We're going to apply it this one unit. Now it's going to be applied from this materials to the work in process GL account and be supported by a job cost sheet as opposed to being tracked in our just materials ledger. Also note that this system works well if these units planks of woods don't change in value, meaning if the planks of wood become more expensive over time just because of inflation, then we're going to have similar issues that we have with inventory tracking. We're going to have to use some type of method actual cost of the inventory and track it specific identification or probably some kind of cost flow like first in first out the assumption that we have a first in first out assumption last in first out or average. So we'll have those same kind of inventory tracking problems that we have for the materials ledger as we would for just inventory in general. And then we got this would be the requisition form. So when we had this item here, this isn't going to be the same form. But when we had this requisition, this is the type of form that we would use for the requisition. And remember in a big company, then we would have to have this process of one department of requisitioning. So if I'm in the warehouse, and I'm asking for a plank of wood, it I have to go I'd have to go I mean, if I'm in the working process, the factory, I need a plank of wood to make our project, then we might have to use a requisition form to get that wood from the warehouse. Now, of course, the smaller a company is then, and if we're a construction company working on a job, then the requisition forms might be similar to just the receipts, you know, that we're using in order to purchase materials that will then be supportive of what we're going to be using in the in the working process. So the requisition form here is being used for us to take it from the warehouse that it's already been purchased. But it's also going to be the form that we're going to use in order to apply it to a job, when we create the job cost sheet. So the requisite and so when we create if it was if we were a smaller company, we might use, you know, receipts to create, of course, the job cost sheet for the materials that we would be purchasing. So we're going to have the job number that we're going to have on here, the materials, the quantity that we need one plank of wood quantity provided, hopefully they're the same unless