What is the journal entry to record the purchase

Assignment Help Accounting Basics

Reference no: EM131962039

Problem

During the prior fiscal year, Cameo Corp. signed a long-term noncancellable purchase commitment with its primary supplier to purchase $11.5 million of raw materials. Cameo paid the $11.5 million to acquire the raw materials when the raw materials were only worth $9.8 million. Assume that the purchase commitment was properly recorded. What is the journal entry to record the purchase?

Reference no: EM131962039

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