Question 1

Indirect labor costs are those costs to transform raw materials into a finished product.

Accepted Answer

A) True 
 B)False

Question 2

McMann Company makes lawn care equipment. It applies overhead at the rate of 125% of direct labor costs. During the year, direct labor costs were $140,000. The actual overhead was $177,000. Make the appropriate general journal entry dated December 31, 20--, to adjust the factory overhead account balance (under- or overapplied) for the year.

Accepted Answer

The answer of McMann Company makes lawn care equipment. It...

Question 3

Match the terms with the definitions.
-The difference between the overhead applied and the actual overhead cost incurred if the amount of applied overhead is greater than actual overhead cost incurred.

Accepted Answer

A) Work in Process 
B) process cost system 
C) overapplied overhead 
D) direct materials 
E) materials requisition
F)factory overhead subsidiary ledger
G)Finished Goods Inventory
H)materials ledger
I)job order cost system
J)indirect materials
K)job cost sheet 
A) Work in Process 
B) process cost system 
C) overapplied overhead 
D) direct materials 
E) materials requisition
F)factory overhead subsidiary ledger
G)Finished Goods Inventory
H)materials ledger
I)job order cost system
J)indirect materials
K)job cost sheet

Question 4

Materials inventory consists of all products on which work has been started but is not yet finished at the end of the accounting period.

Accepted Answer

A) True 
 B)False

Question 5

Match the terms with the definitions.
-A form used to issue materials from the storeroom to production. It serves as both an authorization to the storekeeper to issue materials and a source document showing the movement of materials.

Accepted Answer

A) Work in Process 
B) process cost system 
C) overapplied overhead 
D) direct materials 
E) materials requisition
F)factory overhead subsidiary ledger
G)Finished Goods Inventory
H)materials ledger
I)job order cost system
J)indirect materials
K)job cost sheet 
A) Work in Process 
B) process cost system 
C) overapplied overhead 
D) direct materials 
E) materials requisition
F)factory overhead subsidiary ledger
G)Finished Goods Inventory
H)materials ledger
I)job order cost system
J)indirect materials
K)job cost sheet

Question 6

Products that have been started but are only partially complete at the end of the accounting period are known as

Accepted Answer

A)  materials. 
B)  work in process. 
C)  finished goods. 
D)  cost of goods sold. 
A)  materials. 
B)  work in process. 
C)  finished goods. 
D)  cost of goods sold.

Question 7

Match the terms with the definitions.
-The wages of employees who are directly involved in converting materials into finished goods.

Accepted Answer

A) cost accounting system 
B) daily time sheet 
C) direct labor 
D) underapplied overhead 
E) factory overhead
F)predetermined overhead rate
G)Materials Inventory
H)finished goods ledger
I)indirect labor
J)job cost ledger 
A) cost accounting system 
B) daily time sheet 
C) direct labor 
D) underapplied overhead 
E) factory overhead
F)predetermined overhead rate
G)Materials Inventory
H)finished goods ledger
I)indirect labor
J)job cost ledger

Question 8

Depreciation of factory buildings and equipment is an example of

Accepted Answer

A)  direct labor. 
B)  direct materials. 
C)  factory overhead. 
D)  operating expenses. 
A)  direct labor. 
B)  direct materials. 
C)  factory overhead. 
D)  operating expenses.

Question 9

Match the terms with the definitions.
-A subsidiary ledger for the work in process control account that is made up of job cost sheets.

Accepted Answer

A) cost accounting system 
B) daily time sheet 
C) direct labor 
D) underapplied overhead 
E) factory overhead
F)predetermined overhead rate
G)Materials Inventory
H)finished goods ledger
I)indirect labor
J)job cost ledger 
A) cost accounting system 
B) daily time sheet 
C) direct labor 
D) underapplied overhead 
E) factory overhead
F)predetermined overhead rate
G)Materials Inventory
H)finished goods ledger
I)indirect labor
J)job cost ledger

Question 10

Match the terms with the definitions.
-Those materials used in the manufacturing process that do not become a major part of the finished product.

Accepted Answer

A) Work in Process 
B) process cost system 
C) overapplied overhead 
D) direct materials 
E) materials requisition
F)factory overhead subsidiary ledger
G)Finished Goods Inventory
H)materials ledger
I)job order cost system
J)indirect materials
K)job cost sheet 
A) Work in Process 
B) process cost system 
C) overapplied overhead 
D) direct materials 
E) materials requisition
F)factory overhead subsidiary ledger
G)Finished Goods Inventory
H)materials ledger
I)job order cost system
J)indirect materials
K)job cost sheet

Question 11

O'Connell Corporation had the following transactions for its job order costing operation.
Apr. 4
Purchased materials on account, $17,000.
7
Direct materials requisitioned to production, Job No. 106, $15,800.
12
Direct labor, Job No. 106, $15,200.
16
Indirect materials (factory overhead) requisitioned to production, $3,300.
22
Indirect labor (factory overhead), $2,400.
28
Other indirect costs (factory overhead, credit Accounts Payable), $2,700.
​
Required:
Prepare general journal entries to record these transactions.

Accepted Answer

The answer of O'Connell Corporation had the following transactions for...

Question 12

A schedule of cost of goods manufactured shows all of the following EXCEPT

Accepted Answer

A)  indirect materials. 
B)  beginning work in process. 
C)  goods available for sale. 
D)  ending work in process. 
A)  indirect materials. 
B)  beginning work in process. 
C)  goods available for sale. 
D)  ending work in process.

Question 13

Match the terms with the definitions.
-The subsidiary ledger in which a separate account for each product is kept.

Accepted Answer

A) cost accounting system 
B) daily time sheet 
C) direct labor 
D) underapplied overhead 
E) factory overhead
F)predetermined overhead rate
G)Materials Inventory
H)finished goods ledger
I)indirect labor
J)job cost ledger 
A) cost accounting system 
B) daily time sheet 
C) direct labor 
D) underapplied overhead 
E) factory overhead
F)predetermined overhead rate
G)Materials Inventory
H)finished goods ledger
I)indirect labor
J)job cost ledger

Question 14

Which of the following products would most likely be accounted for using a process cost system?

Accepted Answer

A)  custom-ordered trophies 
B)  luxury cruise ships 
C)  modeling clay 
D)  leather furniture 
A)  custom-ordered trophies 
B)  luxury cruise ships 
C)  modeling clay 
D)  leather furniture

Question 15

Factory overhead normally consists of direct materials and indirect labor.

Accepted Answer

A) True 
 B)False

Question 16

The wages paid to those who devote their time to supervision or to work of a general nature in the manufacturing process are included in the indirect costs of the factory operation.

Accepted Answer

A) True 
 B)False

Question 17

Products that are only partially completed at the end of the accounting period are known as finished goods.

Accepted Answer

A) True 
 B)False

Question 18

Match the terms with the definitions.
-The account in which materials, labor, and overhead costs of producing a product are accumulated until the product is completed.

Accepted Answer

A) Work in Process 
B) process cost system 
C) overapplied overhead 
D) direct materials 
E) materials requisition
F)factory overhead subsidiary ledger
G)Finished Goods Inventory
H)materials ledger
I)job order cost system
J)indirect materials
K)job cost sheet 
A) Work in Process 
B) process cost system 
C) overapplied overhead 
D) direct materials 
E) materials requisition
F)factory overhead subsidiary ledger
G)Finished Goods Inventory
H)materials ledger
I)job order cost system
J)indirect materials
K)job cost sheet

Question 19

The most significant difference between a manufacturer's income statement and a merchandiser's income statement is the use of "cost of goods manufactured" in the place of "purchases."

Accepted Answer

A) True 
 B)False

Question 20

Match the terms with the definitions.
-The ledger in which details of the different types of factory overhead costs are accumulated.

Accepted Answer

A) Work in Process 
B) process cost system 
C) overapplied overhead 
D) direct materials 
E) materials requisition
F)factory overhead subsidiary ledger
G)Finished Goods Inventory
H)materials ledger
I)job order cost system
J)indirect materials
K)job cost sheet 
A) Work in Process 
B) process cost system 
C) overapplied overhead 
D) direct materials 
E) materials requisition
F)factory overhead subsidiary ledger
G)Finished Goods Inventory
H)materials ledger
I)job order cost system
J)indirect materials
K)job cost sheet

Exam 26: Manufacturing Accounting: The Job Order Cost System

Indirect labor costs are those costs to transform raw materials into a finished product.

Match the terms with the definitions. -The difference between the overhead applied and the actual overhead cost incurred if the amount of applied overhead is greater than actual overhead cost incurred.

Materials inventory consists of all products on which work has been started but is not yet finished at the end of the accounting period.

Match the terms with the definitions. -A form used to issue materials from the storeroom to production. It serves as both an authorization to the storekeeper to issue materials and a source document showing the movement of materials.

Products that have been started but are only partially complete at the end of the accounting period are known as

Match the terms with the definitions. -The wages of employees who are directly involved in converting materials into finished goods.

Depreciation of factory buildings and equipment is an example of

Match the terms with the definitions. -A subsidiary ledger for the work in process control account that is made up of job cost sheets.

Match the terms with the definitions. -Those materials used in the manufacturing process that do not become a major part of the finished product.

A schedule of cost of goods manufactured shows all of the following EXCEPT

Match the terms with the definitions. -The subsidiary ledger in which a separate account for each product is kept.

Which of the following products would most likely be accounted for using a process cost system?

Factory overhead normally consists of direct materials and indirect labor.

The wages paid to those who devote their time to supervision or to work of a general nature in the manufacturing process are included in the indirect costs of the factory operation.

Products that are only partially completed at the end of the accounting period are known as finished goods.

Match the terms with the definitions. -The account in which materials, labor, and overhead costs of producing a product are accumulated until the product is completed.

The most significant difference between a manufacturer's income statement and a merchandiser's income statement is the use of "cost of goods manufactured" in the place of "purchases."

Match the terms with the definitions. -The ledger in which details of the different types of factory overhead costs are accumulated.

Introduction to Accounting

Analyzing Transactions: the Accounting Equation

The Double-Entry Framework

Journalizing and Posting Transactions

Adjusting Entries and the Work Sheet

Financial Statements and the Closing Process

Accounting for Cash

Payroll Accounting: Employee Earnings and Deductions

Payroll Accounting: Employer Taxes and Reports

Accounting for Sales and Cash Receipts

Accounting for Purchases and Cash Payments

Special Journals

Accounting for Merchandise Inventory

Adjustments and the Work Sheet for a Merchandising Business

Financial Statements and Year-End Accounting for a Merchandising Business

Accounting for Accounts Receivable

Accounting for Notes and Interest

Accounting for Long-Term Assets

Accounting for Partnerships

Corporations: Organization and Capital Stocks

Corporations: Earnings, Taxes, Distributions, and the Retained Earnings Statement

Corporations: Bonds

Statement of Cash Flows

Analysis of Financial Statements

Departmental Accounting

Manufacturing Accounting: The Work Sheet and Financial Statements

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