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During the prior fiscal year, a company signed a long-term noncancellable purchase commitment with its primary supplier to purchase $2.3 million of raw materials. He
During the prior fiscal year, a company signed a long-term noncancellable purchase commitment with its primary supplier to purchase $2.3 million of raw materials. He paid the $2.3 million to acquire the raw materials when the raw materials were only worth $1.8 million. Assume that the purchase commitment was properly recorded. What is the journal entry to record the purchase?
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