Question 1

A criterion for allocating some costs is the cost object's ________ ________ ________ costs allocated to it.

Accepted Answer

A) ability to find 
B) ability to bear 
C) cost-allocation rate 
D) direct-costing system 
E) indirect-costing system 
A) ability to find 
B) ability to bear 
C) cost-allocation rate 
D) direct-costing system 
E) indirect-costing system

Question 2

The ideal part of a manager's long-term strategic plan is to have revenues exceed:

Accepted Answer

A) total costs. 
B) direct costs. 
C) variable costs. 
D) indirect costs. 
E) preliminary costs. 
A) total costs. 
B) direct costs. 
C) variable costs. 
D) indirect costs. 
E) preliminary costs.

Question 3

The Frame Shoppe reported that fixed costs remain constant at $450,000 per month.During high-output months variable costs are $315,000,and during the low-output months variable costs are $60,000.What are the high and low indirect-cost rates if budgeted professional labor-hours are 15,000 for high-output months and 1,857 for low-output months?
Required:
Compute the budgeted indirect cost rate for the high-output month and the low-output month.

Accepted Answer

A) $51 per hour ;$201 per hour 
B) $60 per hour;$206 per hour 
C) $80 per hour;$210 per hour 
D) $85 per hour;$215 per hour 
E) $90 per hour;$220 per hour 
A) $51 per hour ;$201 per hour 
B) $60 per hour;$206 per hour 
C) $80 per hour;$210 per hour 
D) $85 per hour;$215 per hour 
E) $90 per hour;$220 per hour

Question 4

Sara's Accounting Service provides assistance to individuals and groups in the community to help them with their accounting needs.For each item listed below,identify the type category of source documents that her individual clients use to authorize a journal entry in the job-costing system.
a.direct materials purchased
b.direct materials used
c.direct manufacturing labor
d.indirect manufacturing labor
e.finished goods control
f.cost of good sold

Accepted Answer

a.purchase invoice
b.materials

Question 5

Write a short essay and discuss the account that managers refer to when they discuss manufacturing overhead allocated.

Accepted Answer

Managers refer to the contra account,or

Question 6

Write a short essay and discuss how managers track direct manufacturing labor and control manufacturing overhead costs with enhancements in information technology.

Accepted Answer

Managers can track the direct manufactur

Question 7

The service department is also professionally known as the:

Accepted Answer

A) support department. 
B) internal department. 
C) operating department. 
D) international department. 
E) manufacturing department. 
A) support department. 
B) internal department. 
C) operating department. 
D) international department. 
E) manufacturing department.

Question 8

The source document that managers use for direct manufacturing labor,which contains information about the amount of labor time used for a specific job in a specific department is a:

Accepted Answer

A) job-cost sheet. 
B) job-cost record. 
C) labor-time sheet. 
D) indirect-cost record. 
E) material-requisition record. 
A) job-cost sheet. 
B) job-cost record. 
C) labor-time sheet. 
D) indirect-cost record. 
E) material-requisition record.

Question 9

The advantage of the direct and step-down method is that they are simple to compute and understand relative to the reciprocal method.

Accepted Answer

A) True 
 B)False

Question 10

The original record that supports journal entries in an accounting system is the:

Accepted Answer

A) job sheet. 
B) direct costs. 
C) indirect costs. 
D) source document. 
E) direct materials. 
A) job sheet. 
B) direct costs. 
C) indirect costs. 
D) source document. 
E) direct materials.

Question 11

A cost allocation base can be either financial or nonfinancial.

Accepted Answer

A) True 
 B)False

Question 12

The Meredith Company reported the following information:
 
Required:
Compute the Fixed Indirect Cost rate per Direct Professional-Labor Hour.

Accepted Answer

A) $2.58;$.70. 
B) $20.58;$77.77 
C) $200.58;$79.77 
D) $2,000.58;$777.77 
E) $2,058.00;$779.77 
A) $2.58;$.70. 
B) $20.58;$77.77 
C) $200.58;$79.77 
D) $2,000.58;$777.77 
E) $2,058.00;$779.77

Question 13

In the merchandising sector,an example of an organization that utilizes job costing is a company that sends individual items by mail order.

Accepted Answer

A) True 
 B)False

Question 14

Managers compute the plant administration cost-allocation rate as:

Accepted Answer

A) total plant administration costs - total supervision costs. 
B) total plant administration costs × total supervision salaries. 
C) total plant administration costs + total supervision salaries. 
D) total plant administration costs - total supervision salaries. 
E) total plant administration costs / total supervision salaries. 
A) total plant administration costs - total supervision costs. 
B) total plant administration costs × total supervision salaries. 
C) total plant administration costs + total supervision salaries. 
D) total plant administration costs - total supervision salaries. 
E) total plant administration costs / total supervision salaries.

Question 15

Prorating on the basis of the manufacturing overhead allocated (before proration)results in underallocating manufacturing overhead based on actual manufacturing overhead costs.

Accepted Answer

A) True 
 B)False

Question 16

The mechanics of using budgeted rates for direct costs are never similar to the methods employed

Accepted Answer

A) True 
 B)False

Question 17

A systematic way that managers link an indirect cost or group of indirect costs to cost objects is known as:

Accepted Answer

A) cost period. 
B) direct costing. 
C) cost management. 
D) cost-alteration base. 
E) cost-allocation base. 
A) cost period. 
B) direct costing. 
C) cost management. 
D) cost-alteration base. 
E) cost-allocation base.

Question 18

The Pine Tree Service provides tree services to consumers in the community.The manager reported that the indirect costs were $800,000 to run the log-cutting machine for 15,000 hours.
Required:
Compute the cost allocation rate.

Accepted Answer

A) $53.33 per machine-hour. 
B) $63.33 per machine-hour. 
C) $78.50 per machine-hour. 
D) $81.50 per machine-hour. 
E) $120.00 per machine-hour. 
A) $53.33 per machine-hour. 
B) $63.33 per machine-hour. 
C) $78.50 per machine-hour. 
D) $81.50 per machine-hour. 
E) $120.00 per machine-hour.

Question 19

Managers use job costing to cost multiple identical units of ________ products.

Accepted Answer

A) similar 
B) unusual 
C) identical 
D) distinct 
E) proprietary 
A) similar 
B) unusual 
C) identical 
D) distinct 
E) proprietary

Question 20

Managers utilize the adjusted-allocation rate approach because it restates all overhead entries in the general ledger and subsidiary ledgers using actual cost rates rather than budged cost rates.

Accepted Answer

A) True 
 B)False

A criterion for allocating some costs is the cost object's costs allocated to it.

The ideal part of a manager's long-term strategic plan is to have revenues exceed:

Write a short essay and discuss the account that managers refer to when they discuss manufacturing overhead allocated.

Write a short essay and discuss how managers track direct manufacturing labor and control manufacturing overhead costs with enhancements in information technology.

The service department is also professionally known as the:

The source document that managers use for direct manufacturing labor,which contains information about the amount of labor time used for a specific job in a specific department is a:

The advantage of the direct and step-down method is that they are simple to compute and understand relative to the reciprocal method.

The original record that supports journal entries in an accounting system is the:

A cost allocation base can be either financial or nonfinancial.

The Meredith Company reported the following information: Required: Compute the Fixed Indirect Cost rate per Direct Professional-Labor Hour.

In the merchandising sector,an example of an organization that utilizes job costing is a company that sends individual items by mail order.

Managers compute the plant administration cost-allocation rate as:

Prorating on the basis of the manufacturing overhead allocated (before proration)results in underallocating manufacturing overhead based on actual manufacturing overhead costs.

The mechanics of using budgeted rates for direct costs are never similar to the methods employed

A systematic way that managers link an indirect cost or group of indirect costs to cost objects is known as:

The Pine Tree Service provides tree services to consumers in the community.The manager reported that the indirect costs were $800,000 to run the log-cutting machine for 15,000 hours. Required: Compute the cost allocation rate.

Managers use job costing to cost multiple identical units of ________ products.

Managers utilize the adjusted-allocation rate approach because it restates all overhead entries in the general ledger and subsidiary ledgers using actual cost rates rather than budged cost rates.

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Process Costing and Cost Allocation

Activity-Based Costing and Activity-Based Management

Pricing Decisions, customer Profitability, and Cost Management

Determining How Costs Behave

Decision Making and Relevant Information

Quality, inventory Management, and Time

Capital Investments

Master Budget and Responsibility Accounting

Flexible Budgets, cost Variances, and Management Control

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Transfer Pricing

Performance Measurement and Compensation

Filters

Exam 4: Job Costing

A criterion for allocating some costs is the cost object's ________ ________ ________ costs allocated to it.

The ideal part of a manager's long-term strategic plan is to have revenues exceed:

Write a short essay and discuss the account that managers refer to when they discuss manufacturing overhead allocated.

Write a short essay and discuss how managers track direct manufacturing labor and control manufacturing overhead costs with enhancements in information technology.

The service department is also professionally known as the:

The source document that managers use for direct manufacturing labor,which contains information about the amount of labor time used for a specific job in a specific department is a:

The advantage of the direct and step-down method is that they are simple to compute and understand relative to the reciprocal method.

The original record that supports journal entries in an accounting system is the:

A cost allocation base can be either financial or nonfinancial.

The Meredith Company reported the following information: Required: Compute the Fixed Indirect Cost rate per Direct Professional-Labor Hour.

In the merchandising sector,an example of an organization that utilizes job costing is a company that sends individual items by mail order.

Managers compute the plant administration cost-allocation rate as:

Prorating on the basis of the manufacturing overhead allocated (before proration)results in underallocating manufacturing overhead based on actual manufacturing overhead costs.

The mechanics of using budgeted rates for direct costs are never similar to the methods employed

A systematic way that managers link an indirect cost or group of indirect costs to cost objects is known as:

The Pine Tree Service provides tree services to consumers in the community.The manager reported that the indirect costs were $800,000 to run the log-cutting machine for 15,000 hours. Required: Compute the cost allocation rate.

Managers use job costing to cost multiple identical units of ________ products.

Managers utilize the adjusted-allocation rate approach because it restates all overhead entries in the general ledger and subsidiary ledgers using actual cost rates rather than budged cost rates.

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Process Costing and Cost Allocation

Activity-Based Costing and Activity-Based Management

Pricing Decisions, customer Profitability, and Cost Management

Determining How Costs Behave

Decision Making and Relevant Information

Quality, inventory Management, and Time

Capital Investments

Master Budget and Responsibility Accounting

Flexible Budgets, cost Variances, and Management Control

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Transfer Pricing

Performance Measurement and Compensation

Filters

A criterion for allocating some costs is the cost object's costs allocated to it.