Question 1

The actual costs of all individual overhead categories are recorded in the Manufacturing Overhead Control account.

Accepted Answer

A) True 
 B)False

Question 2

________ is the process of assigning indirect costs to products.

Accepted Answer

A)  Cost allocation 
B)  Job cost recording 
C)  Cost pooling 
D)  Cost tracing 
A)  Cost allocation 
B)  Job cost recording 
C)  Cost pooling 
D)  Cost tracing

Question 3

Chief Manufacturing is a small textile manufacturer using machine-hours as the single indirect-cost rate to allocate manufacturing overhead costs to the various jobs contracted during the year. The following estimates are provided for the coming year for the company and for the Somerset High School Science Olympiad Jacket job.
   
Required:
a.For Chief Manufacturing, determine the annual manufacturing overhead cost-allocation rate.
b.Determine the amount of manufacturing overhead costs allocated to the Somerset High School job.
c.Determine the estimated total manufacturing costs for the Somerset High School job.

Accepted Answer

6a.Manufacturing overhead cost-allocatio

Question 4

When goods are sold, the Cost of Goods Sold account is debited while the Finished Goods Control account is credited.

Accepted Answer

A) True 
 B)False

Question 5

Work-in-Process Control will be decreased (credited) for the amount of direct-labor costs incurred.

Accepted Answer

A) True 
 B)False

Question 6

For 2018, Winters Manufacturing uses machine-hours as the only overhead cost-allocation base. The direct cost rate is $2.00 per unit. The selling price of the product is $27.00. The estimated manufacturing overhead costs are $220,000 and estimated 20,000 machine hours. The actual manufacturing overhead costs are $225,000 and actual machine hours are 25,000. What is the profit margin earned if each unit requires two machine-hours?

Accepted Answer

A)  45.00% 
B)  25.93% 
C)  50.00% 
D)  90.00% 
A)  45.00% 
B)  25.93% 
C)  50.00% 
D)  90.00%

Question 7

The budgeted indirect-cost rate is calculated ________.

Accepted Answer

A)  at the beginning of the year 
B)  during the year 
C)  at the end of each quarter 
D)  at the end of the year 
A)  at the beginning of the year 
B)  during the year 
C)  at the end of each quarter 
D)  at the end of the year

Question 8

When manufacturing overhead is allocated to jobs, the Manufacturing Overhead Allocated account is debited.

Accepted Answer

A) True 
 B)False

Question 9

The Salaries Payable Control account has underlying subsidiary ledgers.

Accepted Answer

A) True 
 B)False

Question 10

Jordan Company has two departments, Assembly and Machining. Overhead is applied based on direct labor cost in Department Assembly and machine-hours in Department Machining. The following additional information is available:
   
Required:
a.Compute the budgeted factory overhead rate for Assembly.
b.Compute the budgeted factory overhead rate for Machining.
c.What is the total overhead cost of Job 10?
d.If Job 10 consists of 50 units of product, what is the unit cost of this job?

Accepted Answer

a.$300,000/$200,000 = 150%
b.$180,000/30

Question 11

A local CPA employs ten full-time professionals. The budgeted compensation per employee is $50,000. The maximum billable hours for each client are 400. Clients always receive their full amount of time. All professional labor costs are included in a single direct-cost category and are traced to jobs on a per-hour basis. Any other costs are included in a single indirect-cost pool, allocated according to professional labor-hours. Budgeted indirect costs for the year are $200,000 and the firm had 20 clients.
Required:
a.What is the direct-labor-cost rate per hour?
b.What is the indirect-cost rate per hour?

Accepted Answer

The answer of A local CPA employs ten full-time professionals....

Question 12

River Falls Manufacturing uses a normal cost system and had the following data available for 2018:
 
The ending balance of finished goods inventory is ________.

Accepted Answer

A)  $53,000 
B)  $40,000 
C)  $93,000 
D)  $288,000 
A)  $53,000 
B)  $40,000 
C)  $93,000 
D)  $288,000

Question 13

When an organization allocated indirect costs to departments by relative size of the budgets, it is based on the criterion of benefits received.

Accepted Answer

A) True 
 B)False

Question 14

For 2018, Franklin Manufacturing uses machine-hours as the only overhead cost-allocation base. The estimated manufacturing overhead costs are $340,000 and estimated machine hours are 40,000. The actual manufacturing overhead costs are $450,000 and actual machine hours are 50,000. What is the difference between the budgeted and the actual manufacturing overhead using job costing? (Round interim and the final answer to the nearest cent.)

Accepted Answer

A)  $2.75 
B)  $2.20 
C)  $0.50 
D)  $2.25 
A)  $2.75 
B)  $2.20 
C)  $0.50 
D)  $2.25

Question 15

Explain the procedure how overhead indirect costs become a part of work-in process inventory.

Accepted Answer

The overhead (indirect) costs cannot be

Question 16

The spreading of underallocated or overallocated overhead among ending work-in-process, finished goods, and cost of goods sold is called ________.

Accepted Answer

A)  the adjusted allocation rate approach 
B)  the proration approach 
C)  the write-off of cost of goods sold approach 
D)  the weighted-average cost approach 
A)  the adjusted allocation rate approach 
B)  the proration approach 
C)  the write-off of cost of goods sold approach 
D)  the weighted-average cost approach

Question 17

An example of a numerator reason for calculating annual indirect-cost rates includes ________.

Accepted Answer

A)  fewer production workdays in a month 
B)  cost of raw materials purchased 
C)  higher snow-removal costs during the winter 
D)  the number of units produced 
A)  fewer production workdays in a month 
B)  cost of raw materials purchased 
C)  higher snow-removal costs during the winter 
D)  the number of units produced

Question 18

The actual indirect-cost rate is calculated by ________.

Accepted Answer

A)  dividing actual total indirect costs by the actual total quantity of the cost-allocation base 
B)  multiplying actual total indirect costs by the actual total quantity of the cost-allocation base 
C)  dividing the actual total quantity of the cost allocation base by actual total indirect costs 
D)  multiplying the actual total quantity of the cost allocation base by actual total indirect costs 
A)  dividing actual total indirect costs by the actual total quantity of the cost-allocation base 
B)  multiplying actual total indirect costs by the actual total quantity of the cost-allocation base 
C)  dividing the actual total quantity of the cost allocation base by actual total indirect costs 
D)  multiplying the actual total quantity of the cost allocation base by actual total indirect costs

Question 19

When goods are finished, the Finished Goods Control account is debited while the Work-in-Process Control account is credited.

Accepted Answer

A) True 
 B)False

Question 20

Actual costing helps managers get information earlier and take corrective measures to improve labor efficiency.

Accepted Answer

A) True 
 B)False

The actual costs of all individual overhead categories are recorded in the Manufacturing Overhead Control account.

________ is the process of assigning indirect costs to products.

When goods are sold, the Cost of Goods Sold account is debited while the Finished Goods Control account is credited.

Work-in-Process Control will be decreased (credited) for the amount of direct-labor costs incurred.

The budgeted indirect-cost rate is calculated ________.

When manufacturing overhead is allocated to jobs, the Manufacturing Overhead Allocated account is debited.

The Salaries Payable Control account has underlying subsidiary ledgers.

River Falls Manufacturing uses a normal cost system and had the following data available for 2018: The ending balance of finished goods inventory is ________.

When an organization allocated indirect costs to departments by relative size of the budgets, it is based on the criterion of benefits received.

Explain the procedure how overhead indirect costs become a part of work-in process inventory.

The spreading of underallocated or overallocated overhead among ending work-in-process, finished goods, and cost of goods sold is called ________.

An example of a numerator reason for calculating annual indirect-cost rates includes ________.

The actual indirect-cost rate is calculated by ________.

When goods are finished, the Finished Goods Control account is debited while the Work-in-Process Control account is credited.

Actual costing helps managers get information earlier and take corrective measures to improve labor efficiency.

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Activity-Based Costing and Activity-Based Management

Master Budget and Responsibility Accounting

Flexible Budgets, Direct-Cost Variances, and Management Control

Flexible Budgets, Overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Pricing Decisions and Cost Management

Cost Allocation, Customer-Profitability Analysis, and Sales-Variance Analysis

Allocation of Support-Department Costs, Common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, Rework, and Scrap

Balanced Scorecard: Quality and Time

Inventory Management, Just-in-Time, and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, Transfer Pricing, and Multinational Considerations

Performance Measurement, Compensation, and Multinational Considerations

Filters

Exam 4: Job Costing

The actual costs of all individual overhead categories are recorded in the Manufacturing Overhead Control account.

________ is the process of assigning indirect costs to products.

When goods are sold, the Cost of Goods Sold account is debited while the Finished Goods Control account is credited.

Work-in-Process Control will be decreased (credited) for the amount of direct-labor costs incurred.

The budgeted indirect-cost rate is calculated ________.

When manufacturing overhead is allocated to jobs, the Manufacturing Overhead Allocated account is debited.

The Salaries Payable Control account has underlying subsidiary ledgers.

River Falls Manufacturing uses a normal cost system and had the following data available for 2018: The ending balance of finished goods inventory is ________.

When an organization allocated indirect costs to departments by relative size of the budgets, it is based on the criterion of benefits received.

Explain the procedure how overhead indirect costs become a part of work-in process inventory.

The spreading of underallocated or overallocated overhead among ending work-in-process, finished goods, and cost of goods sold is called ________.

An example of a numerator reason for calculating annual indirect-cost rates includes ________.

The actual indirect-cost rate is calculated by ________.

When goods are finished, the Finished Goods Control account is debited while the Work-in-Process Control account is credited.

Actual costing helps managers get information earlier and take corrective measures to improve labor efficiency.

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Activity-Based Costing and Activity-Based Management

Master Budget and Responsibility Accounting

Flexible Budgets, Direct-Cost Variances, and Management Control

Flexible Budgets, Overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Pricing Decisions and Cost Management

Cost Allocation, Customer-Profitability Analysis, and Sales-Variance Analysis

Allocation of Support-Department Costs, Common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, Rework, and Scrap

Balanced Scorecard: Quality and Time

Inventory Management, Just-in-Time, and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, Transfer Pricing, and Multinational Considerations

Performance Measurement, Compensation, and Multinational Considerations

Filters