Question 1

Selected accounts with a credit amount omitted are as follows   ​   ​ What was the balance of Work in Process as of April 30?

Accepted Answer

A)  $8,100 
B)  $35,000 
C)  $29,900 
D)  $22,900 
A)  $8,100 
B)  $35,000 
C)  $29,900 
D)  $22,900

Question 2

The basis for recording direct and indirect labor costs incurred is a summary of the period's

Accepted Answer

A)  job order cost sheets 
B)  time tickets 
C)  employees' earnings records 
D)  clock cards 
A)  job order cost sheets 
B)  time tickets 
C)  employees' earnings records 
D)  clock cards

Question 3

During the period, labor costs incurred on account amounted to $175,000, including $150,000 for production orders and $25,000 for general factory use. Factory overhead applied to production was $23,000. The entry to record the factory overhead applied to production is

Accepted Answer

A)  Work in Process Factory Overhead 25,000
25,000 
B)  Factory Overhead Work in Process 23,000
23,000 
C)  Work in Process Factory Overhead 23,000
23,000 
D)  Factory Overhead Accounts Payable 25,000
25,000 
A)  Work in Process Factory Overhead 25,000
25,000 
B)  Factory Overhead Work in Process 23,000
23,000 
C)  Work in Process Factory Overhead 23,000
23,000 
D)  Factory Overhead Accounts Payable 25,000
25,000

Question 4

Match the costs that follow to the type of product cost a-c) or designate as not a product cost d).
-factory depreciation

Accepted Answer

A) direct labor 
B) direct materials 
C) factory overhead 
D) not a product cost 
A) direct labor 
B) direct materials 
C) factory overhead 
D) not a product cost

Question 5

Adams Company is a manufacturing company that has worked on several production jobs during the first quarter of the year. Below is a list of all the jobs for the quarter:   Jobs 356, 357, 358, and 359 were completed. Jobs 356 and 357 were sold at a profit of $500 on each job.
-What is the gross profit for Adams Company at the end of the first quarter?

Accepted Answer

A)  $1,685 
B)  $2,685 
C)  $1,000 
D)  $685 
A)  $1,685 
B)  $2,685 
C)  $1,000 
D)  $685

Question 6

Match each of the following phrases with the term a-g) that it most closely describes.
-typically used by companies that make custom products

Accepted Answer

A) job order cost system 
B) process cost system 
C) activity-based costing 
D) under applied overhead 
E) over applied overhead
F)finished goods ledger
G)materials ledger 
A) job order cost system 
B) process cost system 
C) activity-based costing 
D) under applied overhead 
E) over applied overhead
F)finished goods ledger
G)materials ledger

Question 7

Technics Inc., a manufacturing company, utilizes job order costing. Each division establishes its own estimates regarding overhead, which are as follows:   Required:
If Division A allocates overhead on the basis of machine hours, and Division B allocates overhead as a percentage of direct labor costs, what would the predetermined overhead rate be for each division?

Accepted Answer

$128,000/16,000 = $8

Question 8

The Cavy Company estimates that the factory overhead for the following year will be $1,250,000. The company has decided that the basis for applying factory overhead should be machine hours, which is estimated to be 40,000 hours. The machine hours for the month of April for all of the jobs was 4,780. If the actual factory overhead totaled $141,800, determine the over- or under applied amount for the month.

Accepted Answer

A)  $7,575 under applied 
B)  $35,220 under applied 
C)  $7,575 over applied 
D)  $35,220 over applied 
A)  $7,575 under applied 
B)  $35,220 under applied 
C)  $7,575 over applied 
D)  $35,220 over applied

Question 9

At the end of July, the first month of the current fiscal year, the factory overhead account had a debit balance. Which of the following describes the nature of this balance and how it would be reported on the interim balance sheet?

Accepted Answer

A)  Over applied, deferred credit 
B)  Under applied, deferred debit 
C)  Under applied, deferred credit 
D)  Over applied, deferred debit 
A)  Over applied, deferred credit 
B)  Under applied, deferred debit 
C)  Under applied, deferred credit 
D)  Over applied, deferred debit

Question 10

A manufacturing company applies factory overhead based on direct labor hours. At the beginning of the year, it estimated that factory overhead costs would be $360,000 and direct labor hours would be 30,000. Actual manufacturing overhead costs incurred were $377,200, and actual direct labor hours were 36,000. What is the predetermined overhead rate per direct labor hour?

Accepted Answer

A)  $12.00 
B)  $10.00 
C)  $12.57 
D)  $10.48 
A)  $12.00 
B)  $10.00 
C)  $12.57 
D)  $10.48

Question 11

Costs that are incurred in generating revenues during the period, but are not involved in the manufacturing process are referred to as

Accepted Answer

A)  period costs 
B)  conversion costs 
C)  factory overhead costs 
D)  product costs 
A)  period costs 
B)  conversion costs 
C)  factory overhead costs 
D)  product costs

Question 12

Selected accounts with amounts omitted are as follows   If the balance of Work in Process at August 31 is $220,000, what was the amount debited to Work in Process for direct materials in August?

Accepted Answer

A)  $390,000 
B)  $170,000 
C)  $525,000 
D)  $580,000 
A)  $390,000 
B)  $170,000 
C)  $525,000 
D)  $580,000

Question 13

Match each of the following phrases with the term a-g) that it most closely describes.
-the stock ledger

Accepted Answer

A) job order cost system 
B) process cost system 
C) activity-based costing 
D) under applied overhead 
E) over applied overhead
F)finished goods ledger
G)materials ledger 
A) job order cost system 
B) process cost system 
C) activity-based costing 
D) under applied overhead 
E) over applied overhead
F)finished goods ledger
G)materials ledger

Question 14

All of the following are true regarding product costs except

Accepted Answer

A)  product costs are found on the balance sheet until they are sold 
B)  product costs consist of direct labor, direct materials, and factory overhead 
C)  product costs can be found in three accounts on the balance sheet 
D)  product costs include sales and administrative expenses 
A)  product costs are found on the balance sheet until they are sold 
B)  product costs consist of direct labor, direct materials, and factory overhead 
C)  product costs can be found in three accounts on the balance sheet 
D)  product costs include sales and administrative expenses

Question 15

The Winston Company estimates that the factory overhead for the following year will be $1,250,000. The company has decided that the basis for applying factory overhead should be machine hours, which is estimated to be 50,000 hours. The total machine hours for the year was 54,300. The actual factory overhead for the year was $1,348,800.
a) Determine the total factory overhead amount applied.
b) Calculate the over- or under applied amount for the year.
c) Prepare the journal entry to close Factory Overhead into Cost of Goods Sold.

Accepted Answer

a) $1,250,000/50,000 = $25
54,

Question 16

Job order cost accounting systems may be used to evaluate a company's efficiency.

Accepted Answer

A) True 
 B)False

Question 17

Perpetual inventory controlling accounts and subsidiary ledgers are maintained for materials, work in process, and finished goods in job order costing systems.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following is a period cost?

Accepted Answer

A)  depreciation on factory lunchroom furniture 
B)  salary of telephone receptionist in the sales office 
C)  salary of a security guard for the factory parking lot 
D)  computer chips used by a computer manufacturer 
A)  depreciation on factory lunchroom furniture 
B)  salary of telephone receptionist in the sales office 
C)  salary of a security guard for the factory parking lot 
D)  computer chips used by a computer manufacturer

Question 19

Factory overhead is applied to production using a predetermined overhead rate.

Accepted Answer

A) True 
 B)False

Question 20

A summary of the time tickets for August follows:   Present the journal entries to record a) the labor cost incurred and b) the application of factory overhead to production for August. The factory overhead rate is 70% of direct labor cost.

Accepted Answer

a) Work in Process 39,200
Fact

Exam 17: Job Order Costing

Selected accounts with a credit amount omitted are as follows ​ ​ What was the balance of Work in Process as of April 30?

The basis for recording direct and indirect labor costs incurred is a summary of the period's

During the period, labor costs incurred on account amounted to $175,000, including $150,000 for production orders and $25,000 for general factory use. Factory overhead applied to production was $23,000. The entry to record the factory overhead applied to production is

Match the costs that follow to the type of product cost a-c) or designate as not a product cost d). -factory depreciation

Match each of the following phrases with the term a-g) that it most closely describes. -typically used by companies that make custom products

At the end of July, the first month of the current fiscal year, the factory overhead account had a debit balance. Which of the following describes the nature of this balance and how it would be reported on the interim balance sheet?

Costs that are incurred in generating revenues during the period, but are not involved in the manufacturing process are referred to as

Selected accounts with amounts omitted are as follows If the balance of Work in Process at August 31 is $220,000, what was the amount debited to Work in Process for direct materials in August?

Match each of the following phrases with the term a-g) that it most closely describes. -the stock ledger

All of the following are true regarding product costs except

Job order cost accounting systems may be used to evaluate a company's efficiency.

Perpetual inventory controlling accounts and subsidiary ledgers are maintained for materials, work in process, and finished goods in job order costing systems.

Which of the following is a period cost?

Factory overhead is applied to production using a predetermined overhead rate.

A summary of the time tickets for August follows: Present the journal entries to record a) the labor cost incurred and b) the application of factory overhead to production for August. The factory overhead rate is 70% of direct labor cost.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting Concepts and Principles

Process Cost Systems

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing for Management Analysis

Budgeting

Performance Evaluation Using Variances From Standard Costs

Performance Evaluation for Decentralized Operations

Differential Analysis, Product Pricing, and Activity-Based Costing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

Lean Principles, Lean Accounting, and Activity Analysis

Filters

Selected accounts with a credit amount omitted are as follows What was the balance of Work in Process as of April 30?