Question 1

Of these three accounts; Raw Materials Inventory, Factory Labor, and Manufacturing Overhead, ______________ is not a control account.

Accepted Answer

The answer of Of these three accounts; Raw Materials Inventory,...

Question 2

Foster Manufacturing uses a job order cost accounting system. On April 1, the company has Work in Process Inventory of $7,600 and two jobs in process: Job No. 221, $3,600, and Job No. 222, $4,000. During April, a summary of source documents reveals the following:   
Foster applies manufacturing overhead to jobs at an overhead rate of 60% of direct labor cost. Job No. 221 is completed during the month.
Instructions
(a) Prepare summary journal entries to record the raw materials requisitioned, factory labor used, the assignment of manufacturing overhead to jobs, and the completion of Job No. 221.
(b) Calculate the balance of the Work in Process Inventory account at April 30.

Accepted Answer

The answer of Foster Manufacturing uses a job order cost...

Question 3

Actual manufacturing overhead costs are assigned to each job by tracing each overhead cost to a specific job.

Accepted Answer

A) True 
 B)False

Question 4

Materials requisition slips are costed

Accepted Answer

A)  by production supervisors. 
B)  by factory personnel who work on the production line. 
C)  after the goods have been sold. 
D)  using any of the inventory costing methods. 
A)  by production supervisors. 
B)  by factory personnel who work on the production line. 
C)  after the goods have been sold. 
D)  using any of the inventory costing methods.

Question 5

Barnes Company applies overhead on the basis of machine hours. Given the following data, compute overhead applied and the under- or overapplication of overhead for the period:

Accepted Answer

A)  $1,450,000 applied and $20,000 overapplied 
B)  $1,500,000 applied and $20,000 overapplied 
C)  $1,450,000 applied and $20,000 underapplied 
D)  $1,470,000 applied and neither under- nor overapplied 
A)  $1,450,000 applied and $20,000 overapplied 
B)  $1,500,000 applied and $20,000 overapplied 
C)  $1,450,000 applied and $20,000 underapplied 
D)  $1,470,000 applied and neither under- nor overapplied

Question 6

Manufacturing overhead applied is added to direct labor incurred and to what other item to equal total manufacturing costs for the period?

Accepted Answer

A)  Goods available for sale. 
B)  Raw materials purchased. 
C)  Work in process. 
D)  Direct materials used. 
A)  Goods available for sale. 
B)  Raw materials purchased. 
C)  Work in process. 
D)  Direct materials used.

Question 7

Records of individual items of raw materials would not be maintained

Accepted Answer

A)  electronically. 
B)  manually. 
C)  on stores ledger cards. 
D)  in the Raw Materials Inventory account. 
A)  electronically. 
B)  manually. 
C)  on stores ledger cards. 
D)  in the Raw Materials Inventory account.

Question 8

If manufacturing overhead has been underapplied during the year, the adjusting entry at the end of the year will show a

Accepted Answer

A)  debit to Manufacturing Overhead. 
B)  credit to Cost of Goods Sold. 
C)  debit to Work in Process Inventory. 
D)  debit to Cost of Goods Sold. 
A)  debit to Manufacturing Overhead. 
B)  credit to Cost of Goods Sold. 
C)  debit to Work in Process Inventory. 
D)  debit to Cost of Goods Sold.

Question 9

Manufacturing cost data for Dolan Company, which uses a job order cost system, are presented below:   
Instructions
Indicate the missing amount for each letter. Assume that overhead is applied on the basis of direct labor cost and that the rate is the same for both cases.

Accepted Answer

The answer of Manufacturing cost data for Dolan Company, which...

Question 10

Factory Labor is a(n)

Accepted Answer

A)  expense account. 
B)  control account. 
C)  subsidiary account. 
D)  manufacturing cost clearing account. 
A)  expense account. 
B)  control account. 
C)  subsidiary account. 
D)  manufacturing cost clearing account.

Question 11

On the cost of goods manufactured schedule, the cost of goods manufactured agrees with the

Accepted Answer

A)  balance of Finished Goods Inventory at the end of the period. 
B)  total debits to Work in Process Inventory during the period. 
C)  amount transferred from Work in Process Inventory to Finished Goods during the period. 
D)  debits to Cost of Goods Sold during the period. 
A)  balance of Finished Goods Inventory at the end of the period. 
B)  total debits to Work in Process Inventory during the period. 
C)  amount transferred from Work in Process Inventory to Finished Goods during the period. 
D)  debits to Cost of Goods Sold during the period.

Question 12

Under an effective system of internal control, the authorization for issuing materials is made

Accepted Answer

A)  orally. 
B)  on a prenumbered materials requisition slip. 
C)  by the accounting department. 
D)  by anyone on the production line. 
A)  orally. 
B)  on a prenumbered materials requisition slip. 
C)  by the accounting department. 
D)  by anyone on the production line.

Question 13

The following amounts were reported by Burke Company before adjusting its immaterial overapplied manufacturing overhead of $8,000.   
Instructions
Compute what amount Burke will report as cost of goods sold after it disposes of its overapplied overhead.

Accepted Answer

$790,000 -

Question 14

During 2010, Tanner Manufacturing expected Job No. 26 to cost $300,000 of overhead, $500,000 of materials, and $200,000 in labor. Tanner applied overhead based on direct labor cost. Actual production required an overhead cost of $560,000, $550,000 in materials used, and $220,000 in labor. All of the goods were completed. What amount was transferred to Finished Goods?

Accepted Answer

A)  $1,000,000 
B)  $1,050,000 
C)  $1,070,000 
D)  $1,100,000 
A)  $1,000,000 
B)  $1,050,000 
C)  $1,070,000 
D)  $1,100,000

Question 15

Match the items in the two columns below by entering the appropriate code letter in the space provided.
A. Cost accounting F. Process cost system
B. Materials requisition slip G. Job cost sheets
C. Time ticket H. Predetermined overhead rate
D. Cost accounting system I. Overapplied overhead
E. Job order cost system J. Underapplied overhead
_____ 1. Used to apply manufacturing overhead to jobs.
_____ 2. Measures, records, and reports product costs.
_____ 3. When actual manufacturing overhead costs are greater than the overhead applied to products.
_____ 4. Manufacturing cost accounts are fully integrated into the general ledger.
_____ 5. Source document which authorizes issuance of raw materials to production.
_____ 6. Appropriate when products have distinguishing and heterogeneous characteristics.
_____ 7. Constitute a subsidiary ledger for Work in Process Inventory.
_____ 8. Indicates number of hours that employees work and the account to be charged.
_____ 9. Appropriate when products are similar and are produced continuously.
_____ 10. When actual manufacturing overhead costs are less than the overhead applied to products.

Accepted Answer

1. H 6. E
2. A 7. G

Question 16

Overapplied overhead means that actual manufacturing overhead costs were greater than the manufacturing overhead costs applied to jobs.

Accepted Answer

A) True 
 B)False

Question 17

In determining total manufacturing costs on the cost of goods manufactured schedule,

Accepted Answer

A)  beginning work in process inventory should have a zero balance. 
B)  actual manufacturing overhead costs appear as a deduction. 
C)  manufacturing overhead applied is added to direct materials and direct labor. 
D)  ending work in process inventory is deducted from beginning work in process inventory. 
A)  beginning work in process inventory should have a zero balance. 
B)  actual manufacturing overhead costs appear as a deduction. 
C)  manufacturing overhead applied is added to direct materials and direct labor. 
D)  ending work in process inventory is deducted from beginning work in process inventory.

Question 18

Builder Bug Company allocates manufacturing overhead at $9 per direct labor hour. Job A45 required 5 boxes of direct materials at a cost of $30 per box and took employees 12 hours to complete. Employees earn $15 per hour.
Instructions
Compute the total cost of Job A45.

Accepted Answer

The answer of Builder Bug Company allocates manufacturing overhead at...

Question 19

Accumulating and assigning manufacturing costs are two important activities in a job order cost system.

Accepted Answer

A) True 
 B)False

Question 20

Manufacturing costs are generally incurred in one period and recorded in a subsequent period.

Accepted Answer

A) True 
 B)False

Exam 20: Job Order Costing

Of these three accounts; Raw Materials Inventory, Factory Labor, and Manufacturing Overhead, ______________ is not a control account.

Actual manufacturing overhead costs are assigned to each job by tracing each overhead cost to a specific job.

Materials requisition slips are costed

Barnes Company applies overhead on the basis of machine hours. Given the following data, compute overhead applied and the under- or overapplication of overhead for the period:

Manufacturing overhead applied is added to direct labor incurred and to what other item to equal total manufacturing costs for the period?

Records of individual items of raw materials would not be maintained

If manufacturing overhead has been underapplied during the year, the adjusting entry at the end of the year will show a

Manufacturing cost data for Dolan Company, which uses a job order cost system, are presented below: Instructions Indicate the missing amount for each letter. Assume that overhead is applied on the basis of direct labor cost and that the rate is the same for both cases.

Factory Labor is a(n)

On the cost of goods manufactured schedule, the cost of goods manufactured agrees with the

Under an effective system of internal control, the authorization for issuing materials is made

The following amounts were reported by Burke Company before adjusting its immaterial overapplied manufacturing overhead of $8,000. Instructions Compute what amount Burke will report as cost of goods sold after it disposes of its overapplied overhead.

Overapplied overhead means that actual manufacturing overhead costs were greater than the manufacturing overhead costs applied to jobs.

In determining total manufacturing costs on the cost of goods manufactured schedule,

Builder Bug Company allocates manufacturing overhead at $9 per direct labor hour. Job A45 required 5 boxes of direct materials at a cost of $30 per box and took employees 12 hours to complete. Employees earn $15 per hour. Instructions Compute the total cost of Job A45.

Accumulating and assigning manufacturing costs are two important activities in a job order cost system.

Manufacturing costs are generally incurred in one period and recorded in a subsequent period.

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Accounting Information Systems

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Corporations: Organization and Capital Stock Transactions

Corporations: Dividends, Retained Earnings, and Income Reporting

Long-Term Liabilities

Investments

Statement of Cash Flows

Financial Analysis: the Big Picture

Managerial Accounting

Process Costing

Cost-Volume-Profit

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

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