Exam 5: Job-Order Costing

A source document by which direct labor costs are assigned to individual jobs is known as a _______________.

The raw materials account is an inventory account located on the income statement.

Figure 5-4.Hill Company uses job-order costing. At the end of the month, the following data was gathered: Hill's selling price is cost plus 50% for each of its products. -Refer to Figure 5-4. What is the total in the work-in-process account?

Which method of measuring costs associated with production is more widely used in practice?

When units are sold, their total cost is debited to _______________ and credited to ____________.

When materials are put into production, they are taken from the Raw Materials account and put into the Work in Process account.

In a _______________________________ costs are accumulated by job.

Figure 5-4.Hill Company uses job-order costing. At the end of the month, the following data was gathered: Hill's selling price is cost plus 50% for each of its products. -Refer to Figure 5-4. What is the total in Finished Goods?

Figure 5-12.Walter Company uses a job-order costing system to account for product costs. The following information pertains to the current year: Plantwide overhead rate is $18 per direct labor hour. -Refer to Figure 5-12. What is the total amount credited to Materials Inventory for Walter in the current year?

The cost of completed units is always debited to Work-in-Process and credited to Finished Goods.

Ring Company designs and builds jewelry. During June it had applied overhead of $120,000. Overhead is applied at the rate of 75% of direct labor cost. Direct labor wages average $20 per hour. How many direct labor hours did Ring Company have for the month of June?

The use of normal costing means that actual overhead costs are assigned directly to jobs.

Figure 5-6.Stutz, Inc. designs and builds basketball gymnasiums. Each gymnasium is custom-built to individual customers' specifications. Stutz uses job-order costing to keep track of its costs. In February it worked on three jobs. Data for these jobs are as follows: Overhead is applied to jobs at the rate of $25 per machine hour. By February 28, Job 178 is the only one unfinished. The balance of Finished Goods on February 1 is $94,000 (consisting of Job 177). Jobs 177 and 179 are sold during February. Stutz sells its product at cost plus 40%. -Refer to Figure 5-6. Calculate the balance of Finished Goods at February 28.

Figure 5-13. During February, Alexander, Inc., worked on two jobs with the following data: Overhead is assigned on the basis of direct labor hours at a rate of $12. During February, Job 12 was completed and transferred to finished goods. Job 13 is the only unfinished job at the end of the month. -Refer to Figure 5-13.

Match each item with the correct statement below. -An approach that assigns the actual costs of direct materials and direct labor to products but uses a predetermined rate to assign overhead costs

Figure 5-8.John's Water Slides makes custom water slides for hotels. On September 1, there were three jobs in process, Jobs 812, 813, and 814. Two more jobs were started during September, Jobs 815 and 816. By September 30, Jobs 812, 814, and 816 were finished. The following data has been collected: Overhead is applied at the rate of 120% of direct labor cost. Jobs are sold at cost plus 60%. Selling and administrative expenses for September totaled $2,950. By September 30, Jobs 812 were 816 are sold, but the customer who ordered Job 814 decided he did not want the slide so it is still in the warehouse. -Refer to Figure 5-8. What is the selling price of Job 816?

_________________________ is the amount that appears as an expense on the income statement after the adjustment for the period's overhead variance is recorded.

Costs associated with selling and general administrative activities are not

Production costs consist of direct materials, direct labor, and overhead.

Which of the following accounts is debited when goods are sold?