Exam 3: Job Costing

The amount of overallocation or underallocation is found by taking the difference between the amount of overhead allocated during the year and the amount of overhead estimated for the year.

When the products are shipped to customers, the cost of manufacturing those products becomes Cost of Goods Sold (COGS)shown on the company's balance sheet.

Process costing is used by companies that produce large numbers of identical units of production in a continuous fashion.

Manufacturing overhead is underallocated if the amount

Management can use job cost information to control costs on future jobs.

How is the cost of direct materials used in production recorded?

The journal entries needed for job costing at a service company

Payroll costs for factory employees who do not work directly on the product are considered

Beta Company uses a predetermined overhead rate based on direct labor hours to allocate manufacturing overhead to jobs. The company estimated that it would incur $600,000 of manufacturing overhead during the year and that 150,000 direct labor hours would be worked. During the year, the company actually incurred manufacturing overhead costs of $582,000 and 135,000 direct labor hours were worked. By how much was manufacturing overhead overallocated or underallocated for the year?

Missy & Daughters allocates manufacturing overhead to jobs based on direct labor hours. The company has the following estimated costs for the upcoming year: The company estimates that 1,360 direct labor hours will be worked in the upcoming year, while 1,000 machine hours will be used during the year. The predetermined manufacturing overhead rate per direct labor hour will be

The total cost of a job shown on the job cost record is the sum of the direct labor traced to the job and the manufacturing overhead allocated to the job.

Hollinger Ceramics makes custom ceramic tiles. During March, the company started and finished Job #755. The company's records show the following direct materials were requisitioned for Job #755. Plain white tiles: 1,200 units at $5.00 per unit Specialty paint: 9 quarts at $8.00 per quart High gloss glaze: 5 quarts at $12.00 per quart Labor time records show the following employees worked on Job #755: Steven Hightop: 20 hours at $27 per hour Andy Pickering: 10 hours at $17 per hour Hollinger Ceramics allocates manufacturing overhead at a rate of $14 per direct labor hour. A)Compute the total amount of direct materials, direct labor, and manufacturing overhead that should be shown on Job #755's job cost record. B)Job #755 consists of 1,200 tiles. If each tile sells for $12.00, what is the gross profit per tile?

Which product costing system would better account for a unique product?

Here are selected data for Campbell Company: Manufacturing overhead is allocated at 60% of direct labor cost. What was the amount of direct labor costs?

In job costing, when raw materials are requisitioned for a job, the raw materials inventory is credited.

Here are selected data for Bailey Company: Manufacturing overhead is allocated at 50% of direct labor cost. What was the amount of direct labor costs?

Here are selected data for Sunny Sky Corporation: What is the finished goods ending inventory?

Actual manufacturing overhead costs are accumulated as debits to a single general ledger account called manufacturing overhead.

On the line in front of each statement, enter either a D for debit or a C for credit to indicate the normal entry that would be needed for each account named. ____ direct labor was incurred on a job: work in process inventory account ____ indirect labor was incurred: wages payable ____ indirect labor was added to a job: manufacturing overhead account ____ direct labor was incurred: wages payable

Ryan's Paints allocates overhead based on machine hours. Selected data for the most recent year follow. The estimates were made as of the beginning of the year, while the actual results were for the entire year. The predetermined manufacturing overhead rate per machine hour is closest to