Question 1

A type of abnormal spoilage is spoilage that occurs because of external environmental events.

Accepted Answer

A) True 
 B)False

Question 2

Organisations can use single or multiple overhead cost pools.

Accepted Answer

A) True 
 B)False

Question 3

Katrina's Cosmetics makes a generic brand of mineral powder it sells to a multinational chain or retail stores. Discoloured powders have their labels removed and are sold as 'seconds'. This is an example of:

Accepted Answer

A)  scrap 
B)  normal spoilage 
C)  rework 
D)  poor quality control 
A)  scrap 
B)  normal spoilage 
C)  rework 
D)  poor quality control

Question 4

Job costing information cannot be used for financial reporting purposes.

Accepted Answer

A) True 
 B)False

Question 5

Mismeasurement of inputs into the costing system is likely to be lower in companies that have just commenced operations.

Accepted Answer

A) True 
 B)False

Question 6

In a job costing system the accounting entry to record the delivery of job XZY is:

Accepted Answer

A)  debit cost of sales; credit finished goods 
B)  debit work in process; credit profit and loss summary account 
C)  debit finished goods inventory; credit work in process 
D)  debit cost of sales, credit profit and loss summary 
A)  debit cost of sales; credit finished goods 
B)  debit work in process; credit profit and loss summary account 
C)  debit finished goods inventory; credit work in process 
D)  debit cost of sales, credit profit and loss summary

Question 7

The following information is available for product JH 947. $\begin{array}{ll}
\text { Direct material costs } & \$ 1.50 \text { per unit of product } \
\text { Direct labour costs } & \$ 500.00 \text { per batch of } 1,500 \text { units } \
\text { Overhead allocation rate } & \$ 28 \text { per machine hour }
\end{array}$
 The cost of a job for 1,500 units of product JH 947, which uses 35 machine hours, is:

Accepted Answer

A)  $1,481.50 
B)  $2.49 
C)  $3,158 
D)  $3,730 
A)  $1,481.50 
B)  $2.49 
C)  $3,158 
D)  $3,730

Question 8

Tres Dieci Ltd employs a process costing system in which direct materials are added at the beginning of the process. Direct material costs from the prior period for beginning work in process are $6,000. The current period's direct material costs total $60,000. The company began the period with 500 units, 60% complete, started 10,500 units, and finished the period with 1,000 units, 50% complete. Using a FIFO system, the direct material cost per equivalent unit is:

Accepted Answer

A)  $6.00 
B)  $5.46 
C)  $6.60 
D)  $5.71 
A)  $6.00 
B)  $5.46 
C)  $6.60 
D)  $5.71

Question 9

The weighted average method isolates efficiencies or inefficiencies in each period by using an average cost.

Accepted Answer

A) True 
 B)False

Question 10

In job costing if scrap can be sold it can reduce the cost of the job it was associated with or be credited to overhead.

Accepted Answer

A) True 
 B)False

Question 11

GAAP requires a product cost for finished goods inventory only.

Accepted Answer

A) True 
 B)False

Question 12

The weighted average cost per unit and the FIFO cost per unit will be identical if there is no beginning work in process inventory.

Accepted Answer

A) True 
 B)False

Question 13

Scrap should always be immediately disposed of using environmentally friendly procedures.

Accepted Answer

A) True 
 B)False

Question 14

Under the FIFO method of process costing, the total manufacturing costs of beginning work in process units will include the prior period costs plus the costs incurred in the current period to complete them.

Accepted Answer

A) True 
 B)False

Question 15

If estimated production overhead in the painting department is $120,000 and actual overhead is $116,000 and estimated machine hours in the painting department are 30,000 hours and actual machine hours are 28,000 hours, the under or over applied overhead is:

Accepted Answer

A)  $12,000 over applied 
B)  $4,000 under applied 
C)  $4,000 over applied 
D)  $8,000 under applied 
A)  $12,000 over applied 
B)  $4,000 under applied 
C)  $4,000 over applied 
D)  $8,000 under applied

Question 16

Mismeasurement in calculating normal spoilage automatically causes errors in calculating

Accepted Answer

A)  rework 
B)  scrap 
C)  abnormal spoilage 
D)  all of the above 
A)  rework 
B)  scrap 
C)  abnormal spoilage 
D)  all of the above

Question 17

Conversion costs are the combined costs of direct labour and manufacturing overhead.

Accepted Answer

A) True 
 B)False

Question 18

Job cost estimates may be used by managers in quoting for future jobs.

Accepted Answer

A) True 
 B)False

Question 19

Equivalent units are calculated by multiplying the percentage of completion by the number of incomplete units.

Accepted Answer

A) True 
 B)False

Question 20

Transferred in costs refer to the costs that flow between departments in mass production facilities.

Accepted Answer

A) True 
 B)False

A type of abnormal spoilage is spoilage that occurs because of external environmental events.

Organisations can use single or multiple overhead cost pools.

Katrina's Cosmetics makes a generic brand of mineral powder it sells to a multinational chain or retail stores. Discoloured powders have their labels removed and are sold as 'seconds'. This is an example of:

Job costing information cannot be used for financial reporting purposes.

Mismeasurement of inputs into the costing system is likely to be lower in companies that have just commenced operations.

In a job costing system the accounting entry to record the delivery of job XZY is:

The following information is available for product JH 947. Direct material costs \ 1.50 per unit of product Direct labour costs \ 500.00 per batch of 1,500 units Overhead allocation rate \ 28 per machine hour The cost of a job for 1,500 units of product JH 947, which uses 35 machine hours, is:

The weighted average method isolates efficiencies or inefficiencies in each period by using an average cost.

In job costing if scrap can be sold it can reduce the cost of the job it was associated with or be credited to overhead.

GAAP requires a product cost for finished goods inventory only.

The weighted average cost per unit and the FIFO cost per unit will be identical if there is no beginning work in process inventory.

Scrap should always be immediately disposed of using environmentally friendly procedures.

Under the FIFO method of process costing, the total manufacturing costs of beginning work in process units will include the prior period costs plus the costs incurred in the current period to complete them.

If estimated production overhead in the painting department is $120,000 and actual overhead is $116,000 and estimated machine hours in the painting department are 30,000 hours and actual machine hours are 28,000 hours, the under or over applied overhead is:

Mismeasurement in calculating normal spoilage automatically causes errors in calculating

Conversion costs are the combined costs of direct labour and manufacturing overhead.

Job cost estimates may be used by managers in quoting for future jobs.

Equivalent units are calculated by multiplying the percentage of completion by the number of incomplete units.

Transferred in costs refer to the costs that flow between departments in mass production facilities.

The Role of Accounting Information in Management Decision Making

Cost Concepts, Behaviour and Estimation

A Costing Framework and Cost Allocation

Costvolumeprofit Cvp Analysis

Planning Budgeting and Behaviour

Operational Budgets

Flexible Budgets, Standard Costs and Variance Analysis

Variance Analysis: Revenue and Cost

Activity Analysis: Costing and Management

Relevant Costs for Decision Making

Strategy and Control

Capital Budgeting and Strategic Investment Decisions

The Strategic Management of Costs and Revenues

Strategic Management Control: a Lean Perspective

Responsibility Accounting, Performance Evaluation and Transfer Pricing

The Balanced Scorecard and Strategy Maps

Rewards, Incentives and Risk Management

Sustainability Management Accounting

Filters

Exam 7: Job and Process Costing Systems

A type of abnormal spoilage is spoilage that occurs because of external environmental events.

Organisations can use single or multiple overhead cost pools.

Katrina's Cosmetics makes a generic brand of mineral powder it sells to a multinational chain or retail stores. Discoloured powders have their labels removed and are sold as 'seconds'. This is an example of:

Job costing information cannot be used for financial reporting purposes.

Mismeasurement of inputs into the costing system is likely to be lower in companies that have just commenced operations.

In a job costing system the accounting entry to record the delivery of job XZY is:

The following information is available for product JH 947. Direct material costs \ 1.50 per unit of product Direct labour costs \ 500.00 per batch of 1,500 units Overhead allocation rate \ 28 per machine hour The cost of a job for 1,500 units of product JH 947, which uses 35 machine hours, is:

The weighted average method isolates efficiencies or inefficiencies in each period by using an average cost.

In job costing if scrap can be sold it can reduce the cost of the job it was associated with or be credited to overhead.

GAAP requires a product cost for finished goods inventory only.

The weighted average cost per unit and the FIFO cost per unit will be identical if there is no beginning work in process inventory.

Scrap should always be immediately disposed of using environmentally friendly procedures.

Under the FIFO method of process costing, the total manufacturing costs of beginning work in process units will include the prior period costs plus the costs incurred in the current period to complete them.

If estimated production overhead in the painting department is $120,000 and actual overhead is $116,000 and estimated machine hours in the painting department are 30,000 hours and actual machine hours are 28,000 hours, the under or over applied overhead is:

Mismeasurement in calculating normal spoilage automatically causes errors in calculating

Conversion costs are the combined costs of direct labour and manufacturing overhead.

Job cost estimates may be used by managers in quoting for future jobs.

Equivalent units are calculated by multiplying the percentage of completion by the number of incomplete units.

Transferred in costs refer to the costs that flow between departments in mass production facilities.

The Role of Accounting Information in Management Decision Making

Cost Concepts, Behaviour and Estimation

A Costing Framework and Cost Allocation

Costvolumeprofit Cvp Analysis

Planning Budgeting and Behaviour

Operational Budgets

Flexible Budgets, Standard Costs and Variance Analysis

Variance Analysis: Revenue and Cost

Activity Analysis: Costing and Management

Relevant Costs for Decision Making

Strategy and Control

Capital Budgeting and Strategic Investment Decisions

The Strategic Management of Costs and Revenues

Strategic Management Control: a Lean Perspective

Responsibility Accounting, Performance Evaluation and Transfer Pricing

The Balanced Scorecard and Strategy Maps

Rewards, Incentives and Risk Management

Sustainability Management Accounting

Filters