Question 1

Briefly describe a Just-in-Time (JIT)system. List the advantages and disadvantages of a JIT system.

Accepted Answer

JIT is a system adopted by some manufact

Question 2

Which of the following IS NOT an advantage of a just-in-time inventory system?

Accepted Answer

A) reduction in storage and warehousing cost. 
B) risk of stock outs. 
C) reduction in working capital requirements. 
D) reduction in costs associated with recordkeeping. 
A) reduction in storage and warehousing cost. 
B) risk of stock outs. 
C) reduction in working capital requirements. 
D) reduction in costs associated with recordkeeping.

Question 3

At the end of the month, if the total of the credits in the Manufacturing Overhead Applied account is greater than the total of the debits in the Manufacturing Overhead account, overhead has been underapplied.

Accepted Answer

A) True 
 B)False

Question 4

A system of accounting in which the costs of each process are accumulated separately and then assigned to the units of product that passed through the process is a:

Accepted Answer

A) Work in Process accounting system. 
B) Process Cost accounting system. 
C) Job Order Cost accounting system. 
D) General Cost accounting system. 
A) Work in Process accounting system. 
B) Process Cost accounting system. 
C) Job Order Cost accounting system. 
D) General Cost accounting system.

Question 5

The process cost accounting system is used when homogenous products are manufactured in a continuous process.

Accepted Answer

A) True 
 B)False

Question 6

Under the LIFO method of inventory valuation, the quantities used are priced from the oldest inventory items available in the order they were received.

Accepted Answer

A) True 
 B)False

Question 7

Martinez Manufacturing applies overhead based on direct labor hours. The company estimates that their overhead for the year will be $180,000, and that they will use 72,000 direct labor hours. During the year, Martinez Manufacturing actually used 71,000 direct labor hours and actual overhead costs were $184,000. At the end of the year, manufacturing overhead was:

Accepted Answer

A) Overapplied by $6,500. 
B) Overapplied by $4,000. 
C) Underapplied by $4,000. 
D) Underapplied by $6,500. 
A) Overapplied by $6,500. 
B) Overapplied by $4,000. 
C) Underapplied by $4,000. 
D) Underapplied by $6,500.

Question 8

When a perpetual inventory system is used, sales revenue is recorded as products are sold,

Accepted Answer

A) but the cost of the goods sold is not recorded. 
B) and the cost of goods sold is transferred from the Cost of Goods Manufactured to the Cost of Goods Sold account. 
C) and the cost of the goods sold is transferred from the Work in Process Inventory account to the Cost of Goods Sold account. 
D) and the cost of the goods sold is transferred from the Finished Goods Inventory account to the Cost of Goods Sold account. 
A) but the cost of the goods sold is not recorded. 
B) and the cost of goods sold is transferred from the Cost of Goods Manufactured to the Cost of Goods Sold account. 
C) and the cost of the goods sold is transferred from the Work in Process Inventory account to the Cost of Goods Sold account. 
D) and the cost of the goods sold is transferred from the Finished Goods Inventory account to the Cost of Goods Sold account.

Question 9

Perpetual inventory records are maintained through the use of subsidiary ledger cards or their automated equivalents.

Accepted Answer

A) True 
 B)False

Question 10

Use the following information for the questions:
Davit Boat Building has three jobs in process in November of the current year, A1-13, R18-4, and B2-19. All three were begun on November 1. Job A1-13 was completed on November 21 with total labor costs of $8,750 and total material costs of $7,725 (details of the individual direct material and direct labor costs charged to job A1-13 are given on the Job Order Cost Sheet provided). No other jobs were completed in November. The total balance in Job R18-4 is $3,275 ($675 in materials and $2,600 in labor) and in Job B2-19 is $6,782 ($1,240 in materials and $5,542 in labor) before overhead is applied. Overhead is applied based on total direct labor dollars.   Estimated total direct labor dollars for the year is $245,000 and total estimated manufacturing overhead is $367,500.
-Based on the information given:
1. Determine the overhead rate for Davit Boat Building;
2. Prepare the journal entry to apply manufacturing overhead to manufacturing process for the month of November;
3. Determine the balance in the Work in Process account.

Accepted Answer

1. The overhead application rate for the

Question 11

When perpetual inventories are maintained in a job order cost system, as each job is completed its cost is transferred from Work in Process Inventory to Finished Goods Inventory.

Accepted Answer

A) True 
 B)False

Question 12

The entry to record the application of overhead to jobs consists of:

Accepted Answer

A) a debit to Manufacturing Overhead Applied and a credit to Manufacturing Overhead. 
B) a debit to Work in Process Inventory and a credit to Manufacturing Overhead Applied. 
C) a debit to Manufacturing Overhead and a credit to Manufacturing Overhead Applied. 
D) a debit to Manufacturing Overhead Applied and a credit to Work in Process Inventory. 
A) a debit to Manufacturing Overhead Applied and a credit to Manufacturing Overhead. 
B) a debit to Work in Process Inventory and a credit to Manufacturing Overhead Applied. 
C) a debit to Manufacturing Overhead and a credit to Manufacturing Overhead Applied. 
D) a debit to Manufacturing Overhead Applied and a credit to Work in Process Inventory.

Question 13

At the end of the fiscal year, any immaterial overapplied or underapplied overhead is:

Accepted Answer

A) closed to the Cost of Goods Manufactured account. 
B) shown on the balance sheet as either a deferred charge or a deferred credit. 
C) allocated to Cost of Goods Sold, Finished Goods Inventory, and Work in Process Inventory. 
D) closed to the Cost of Goods Sold account. 
A) closed to the Cost of Goods Manufactured account. 
B) shown on the balance sheet as either a deferred charge or a deferred credit. 
C) allocated to Cost of Goods Sold, Finished Goods Inventory, and Work in Process Inventory. 
D) closed to the Cost of Goods Sold account.

Question 14

The--------- rate is often computed by dividing estimated overhead costs by estimated direct labor costs.

Accepted Answer

overhead a

Question 15

A worker completes a(n)----------for each job indicating the job performed and the corresponding starting and stopping time.

Accepted Answer

time ticke

Question 16

Millenium Manufacturing is considering two methods for applying overhead. Estimated data for t next year, 2019, follows.
   
1. What is the overhead application rate based on direct labor costs?
2. What would be the overhead application rate based on direct labor hours?
3. If a job requires 720 hours of direct labor, what is the amount of overhead applied to the job usin the rate based on direct labor hours?

Accepted Answer

1.60%; 2. $4.80; 3. $3,456
1.

Question 17

The entry to record applied overhead includes a(n)----------to Manufacturing Overhead Applied.

Accepted Answer

The answer of The entry to record applied overhead includes...

Question 18

Under a job order cost system, unit costs are determined for products manufactured under each----------.

Accepted Answer

production

Question 19

On May 5, a firm purchased 20 units of materials at a unit price of $2.20. On May 15, the firm purchased 35 units at a unit price of $2.45. If the firm uses the FIFO method of inventory pricing, the total cost of 30 units issued on May 20 would be:

Accepted Answer

A) $66.00. 
B) $68.50. 
C) $73.50. 
D) $69.75. 
A) $66.00. 
B) $68.50. 
C) $73.50. 
D) $69.75.

Question 20

What are the two principle cost accounting systems and give an example of a type of business which would use this system?

Accepted Answer

Job Order Cost Accounting System:Used by

Exam 27: Job Order Cost Accounting

Briefly describe a Just-in-Time (JIT)system. List the advantages and disadvantages of a JIT system.

Which of the following IS NOT an advantage of a just-in-time inventory system?

At the end of the month, if the total of the credits in the Manufacturing Overhead Applied account is greater than the total of the debits in the Manufacturing Overhead account, overhead has been underapplied.

A system of accounting in which the costs of each process are accumulated separately and then assigned to the units of product that passed through the process is a:

The process cost accounting system is used when homogenous products are manufactured in a continuous process.

Under the LIFO method of inventory valuation, the quantities used are priced from the oldest inventory items available in the order they were received.

When a perpetual inventory system is used, sales revenue is recorded as products are sold,

Perpetual inventory records are maintained through the use of subsidiary ledger cards or their automated equivalents.

When perpetual inventories are maintained in a job order cost system, as each job is completed its cost is transferred from Work in Process Inventory to Finished Goods Inventory.

The entry to record the application of overhead to jobs consists of:

At the end of the fiscal year, any immaterial overapplied or underapplied overhead is:

The--------- rate is often computed by dividing estimated overhead costs by estimated direct labor costs.

A worker completes a(n)----------for each job indicating the job performed and the corresponding starting and stopping time.

The entry to record applied overhead includes a(n)----------to Manufacturing Overhead Applied.

Under a job order cost system, unit costs are determined for products manufactured under each----------.

On May 5, a firm purchased 20 units of materials at a unit price of $2.20. On May 15, the firm purchased 35 units at a unit price of $2.45. If the firm uses the FIFO method of inventory pricing, the total cost of 30 units issued on May 20 would be:

What are the two principle cost accounting systems and give an example of a type of business which would use this system?

Accounting: The Language of Business

Analyzing Business Transactions

Analyzing Business Transactions Using T Accounts

The General Journal and the General Ledger

Adjustments and the Worksheet

Closing Entries and Teh Postclosing Trial Balance

Accounting for Sales and Accounts Receivable

Accounting for Purchases and Accounts Payable

Cash Receipts, Cash Payments, and Banking Procedures

Payroll Computations, Records, and Payment

Payroll Taxes, Deposits, and Reports

Accruals, Deferrals, and the Worksheet

Financial Statements and Closing Procedures

Accounting Principles and Reporting Standards

Accounts Receivable and Uncollectible Accounts

Notes Payable and Notes Receivable

Merchandise Inventory

Property, Plant, and Equipment

Accounting for Partnerships

Corporations: Formation and Capital Stock Transactions

Corporate Earnings and Capital Transactions

Long-Term Bonds

Financial Statement Analysis

The Statement of Cash Flows

Departmentalized Profit and Cost Centers

Accounting for Manufacturing Activities

Process Cost Accounting

Controlling Manufacturing Costs: Standard Costs

Cost-Revenue Analysis for Decision Making

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