 Hello in this presentation we will define materials ledger card. According to fundamental accounting principles wild 22nd edition the definition of materials ledger card is perpetual record updating each time units are purchased or issued for production use. When considering the term of materials ledger card we're usually thinking of a company which is a manufacturing company one that produces inventory. Support accounting instruction by clicking the link below giving you a free month membership to all of the content on our website broken out by category further broken out by course each course then organized in a logical reasonable fashion making it much more easy to find what you need than can be done on a YouTube page. We also include added resources such as Excel practice problems PDF files and more like QuickBooks backup files when applicable so once again click the link below for a free month membership to our website and all the content on it. Starting from the raw materials moving it to the working process ultimately to finished goods that inventory being what is available for sale at which time of sale it transfers from finished goods to the cost of goods sold expense account. The materials ledger card is dealing with the tracking of the raw materials at the beginning of that production process much like a supplies account we need to track the materials as we purchase the materials and we need to track the materials as those are then transferred from raw materials to either the working process or the factory overhead for example the job cost system would look something like this materials could be used in a job cost system or a process cost system the two systems generally used when working in the accounting for a manufacturing company here we have the trial balance and we have multiple inventory accounts related to the inventory the raw materials work in process factory overhead finished goods we can see the process is going to be going from raw materials then to the work in process and or the factory overhead then to the finished goods at which time the inventory is available for sale when sold it's going to be moved from the finished goods to the expense account of cost of goods sold these accounts will be backed up by general ledger accounts for example raw materials gl account finished goods gl account work in process gl account factory overhead gl account those in order by date and the total in the gl account then backing up and matching the total in the trial balance the general ledger is also going to be supported in a job cost system by job that tracking the costs by job cost unit therefore when transferring work from work in process to finished goods to cost of goods sold we can track the total cost which include materials but also labor and overhead through that job cost process when considering the materials in particular it's going to be similar as when we account for supplies in just a service company or any company at which time we generally purchase the supplies which means we're going to increase the raw materials we need to track what that increase is going to be then we need to attract how we consume those raw materials so we can imagine the raw materials piled up in the warehouse and we've got to track the raw materials that are there then as that raw materials is used and consumed it's going to move to either work in process or factory overhead as the case may be and at that time we're going to have to of course track and reduce the raw materials account here that inventory that inventory asset account going down with a credit and record the increase in the work in process the other inventory account and or the factory overhead those also being asset accounts inventory accounts for the most part and therefore would be going up with a debit