Exam 5: Job Costing

Direct Direct Direct Materials Labour Cost Labour Hours Job 200 \ 500 \ 800 40 Job 201 350 200 10 Job 202 1,000 600 30 Smith Fabricating uses job costing and applies overhead using a normal costing system and uses direct labour cost as the allocation base. This period's estimated overhead cost is $100,000 and estimated direct labour cost of $50,000 and 2,500 direct labour hours. What is the total manufacturing cost of Job 201?

In a normal costing system, an immaterial amount of overapplied overhead is allocated 100% to:

Denmark Furniture uses job costing and allocates its $500,000 of budgeted overhead costs using labour hours. The rate is $25 per labour hour. How many hours are used as normal volume for the overhead allocation base?

Kelita's Kar Kare Kompany had the following cost and inventory data for the month: Costs incurred for the month: Direct labour \ 6,900 Indirect labour 1,500 Direct materials purchased 4,500 Factory utilities 2,200 Factory amortization 3,000 Factory supervision 1,200 Inventories: Ending Beginning Direct materials \ 1,500 \ 1,800 Work in process 4,500 4,050 Finished goods 6,000 5,250 What were the direct costs of production incurred during the month?

Only spoiled goods are reworked.

The cost of normal spoilage arising from a production process common to several jobs is:

Collins Company uses a job costing system and allocates overhead using an estimated overhead allocation rate based on direct labour hours. Information for 2017 is as follows: Estimated Actual Manufacturing overhead \ 166,500 \ 165,000 Direct labour hours 50,000 60,000 The estimated overhead allocation rate for 2017 was:

Star Company's accountants estimate total overhead for each month will be $64,000. They will allocate overhead on the basis of direct labour cost. During the current month, three jobs were worked on: Job 745 Job 746 Direct material \ 36,000 \ 56,000 \ 24,000 Direct labour \ 56,000 \ 72,000 \ 40,000 Job 745 was completed and sold, Job 746 was completed and Job 747 is still in process. Budgeted direct labour cost for the month was $160,000 and actual overhead was $65,800. Assuming overhead was $2,000 underapplied and that this amount is considered material, the balance of work in process after allocation of the underapplied overhead based on overhead charged to the accounts during the period is:

If the cost of rework is tracked, it is recorded in the accounting system in the same manner as:

Allen, Inc. has budgeted $120,000 in variable overhead and $72,000 in fixed overhead for the current month. 8,000 custom units were expected to be produced using 60,000 machine hours. During the month, Allen actually used 68,096 machine hours and produced 8,960 units. Actual overhead costs were: $132,000 variable and $73,600 fixed. Assume Allen uses an actual costing system. The amount of over- or underapplied overhead for the current month is:

Rayfield Company's management accountant collected the following inventory and transaction data for the month: Inventories Ending Beginning Direct materials \ 220 \ 190 Work in process 160 140 Finished goods 190 220 The cost of goods available for sale was $1,370. Total manufacturing costs assigned to work in process during the month was $1,170. Manufacturing overhead was $334; and direct materials used were $386. Direct labour costs incurred during the month were:

A separate cost allocation base must be chosen for each job in a job costing system.

Units of product that are unacceptable and are either discarded or sold at a reduced price are called:

When overhead is underapplied:

All of the following products or services are likely to use job costing except:

The denominator in an overhead allocation rate for normal costing is:

Direct material and direct labour costs are typically traced to individual jobs in a job costing system.

Underapplied and overapplied overhead arise because:

If scrap can be traced to a specific job, revenue from the scrap is:

Managers use estimates in job costing systems to: I. Establish a bid for a job II. Decide whether to accept a job III. Monitor actual operations