Question 1

The predetermined overhead rate is calculated by

Accepted Answer

A)  estimated annual overhead/Estimated manufacturing cost. 
B)  actual annual overhead/Estimated annual activity level. 
C)  estimated annual overhead/Actual annual activity level. 
D)  actual annual overhead/Actual annual activity level. 
E)  estimated annual overhead/Estimated annual activity level. 
A)  estimated annual overhead/Estimated manufacturing cost. 
B)  actual annual overhead/Estimated annual activity level. 
C)  estimated annual overhead/Actual annual activity level. 
D)  actual annual overhead/Actual annual activity level. 
E)  estimated annual overhead/Estimated annual activity level.

Question 2

Which of the following is true about the job-order cost sheet?

Accepted Answer

A)  It is prepared for every job. 
B)  It is subsidiary to the work-in-process account. 
C)  It is the primary document for accumulating all costs related to a particular job. 
D)  It contains all information pertinent to a job. 
E)  All of these are correct. 
A)  It is prepared for every job. 
B)  It is subsidiary to the work-in-process account. 
C)  It is the primary document for accumulating all costs related to a particular job. 
D)  It contains all information pertinent to a job. 
E)  All of these are correct.

Question 3

Match each item with the correct statement below.
-A single overhead rate calculated using all estimated overhead for a factory divided by the estimated activity level across the entire factory

Accepted Answer

A) predetermined overhead rate 
B) plantwide overhead rate 
C) departmental overhead rate 
D) overhead variance 
E) overapplied overhead
F)underapplied overhead
G)applied overhead
H)normal cost of goods sold 
A) predetermined overhead rate 
B) plantwide overhead rate 
C) departmental overhead rate 
D) overhead variance 
E) overapplied overhead
F)underapplied overhead
G)applied overhead
H)normal cost of goods sold

Question 4

the costs of job are transferred from the work-in-process account to finished goods account

Accepted Answer

A) completion of job 
B) end of each accounting period 
C) materials are moved from storage into production 
D) product is sold 
E) end of year 
A) completion of job 
B) end of each accounting period 
C) materials are moved from storage into production 
D) product is sold 
E) end of year

Question 5

Figure 5-11.Olson Corporation constructs new homes. Assume that Olson uses a job costing system. During May of the current year, the following transactions occurred:
Olson purchased $4,500 of lumber on account.Olson used $3,750 of lumber in production and incurred 50 hours of direct labor hours at $15 per hour.Depreciation of $1,500 on equipment used to build new houses was recorded.A house that was completed last period at a cost of $150,000 was sold for $180,000 in cash.
-Refer to Figure 5-11. The journal entry to record labor for Olson would include a

Accepted Answer

A)  debit to Finished Goods of $750. 
B)  debit to Wages Payable of $750. 
C)  credit to Finished Goods of $750. 
D)  debit to Work-in-Process of $750. 
A)  debit to Finished Goods of $750. 
B)  debit to Wages Payable of $750. 
C)  credit to Finished Goods of $750. 
D)  debit to Work-in-Process of $750.

Question 6

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. Calculate the ending balance in Work-in-Process as of September 30.

Accepted Answer

A)  $2,222 
B)  $1,700 
C)  $1,961 
D)  $3,555.20 
E)  $1,392 
A)  $2,222 
B)  $1,700 
C)  $1,961 
D)  $3,555.20 
E)  $1,392

Question 7

On February 1, Job 12 had a beginning balance of $200. During February, direct materials of $500 and direct labor of $200 were added to the job. Overhead is applied to production at a rate of 55% of direct labor. There are 5 units in Job 12. What is the unit cost?

Accepted Answer

A)  $202 
B)  $1,010 
C)  $162 
D)  $810 
E)  None of these. 
A)  $202 
B)  $1,010 
C)  $162 
D)  $810 
E)  None of these.

Question 8

Manufacturing and service firms producing unique products or services require job-order accounting systems.

Accepted Answer

A) True 
 B)False

Question 9

Figure 5-9.Warwick Company has the following transactions for the month of September:
   Balances at the beginning of the month were:
  
-Refer to Figure 5-9. What is the correct journal entry to record actual overhead for the month?

Accepted Answer

The answer of Figure 5-9.Warwick Company has the following transactions...

Question 10

Bower Company manufactures a product in a factory that has two producing departments, Cutting and Stitching, and two support departments, D1 and D2. The activity driver for D1 is number of employees, and the activity driver for D2 is number of machine hours. The following data pertain to Bower:
   Required:
A. Calculate the cost assignment ratios to be used under the direct method for departments D1 and D2.
B. Allocate the support department costs to the producing departments by using the direct method.

Accepted Answer

A.
Allocation ratios for D1 ba

Question 11

Which of the following is not true about job-order costing?

Accepted Answer

A)  It is used in firms that produce homogeneous products. 
B)  The cost of each job is accumulated on the job-order cost sheet. 
C)  The key document for accumulating manufacturing costs is the job-order cost sheet. 
D)  All of these are correct. 
E)  None of these are correct. 
A)  It is used in firms that produce homogeneous products. 
B)  The cost of each job is accumulated on the job-order cost sheet. 
C)  The key document for accumulating manufacturing costs is the job-order cost sheet. 
D)  All of these are correct. 
E)  None of these are correct.

Question 12

Which of the following is not a characteristic of job-order costing?

Accepted Answer

A)  Wide variety of distinct products. 
B)  Unit cost is computed by dividing process costs of the period by the units produced in the period. 
C)  Unit cost is computed by dividing total job costs by units produced on that job. 
D)  Costs accumulated by job. 
E)  Typically, the cost of one job is different from that of another job. 
A)  Wide variety of distinct products. 
B)  Unit cost is computed by dividing process costs of the period by the units produced in the period. 
C)  Unit cost is computed by dividing total job costs by units produced on that job. 
D)  Costs accumulated by job. 
E)  Typically, the cost of one job is different from that of another job.

Question 13

In an actual cost system, actual direct materials, actual direct labor and estimated overhead are used to determine unit cost.

Accepted Answer

A) True 
 B)False

Question 14

Departmental overheads cannot be added together to get plantwide overhead.

Accepted Answer

A) True 
 B)False

Question 15

If actual overhead is greater than applied overhead, the variance is called underapplied overhead.

Accepted Answer

A) True 
 B)False

Question 16

Using normal costing, which costs never enter the work-in-process account?

Accepted Answer

A)  applied overhead 
B)  actual overhead 
C)  direct materials 
D)  direct labor 
E)  None of these. 
A)  applied overhead 
B)  actual overhead 
C)  direct materials 
D)  direct labor 
E)  None of these.

Question 17

Which form asks for type, quantity, unit price of direct materials issued, and for the number of the job?

Accepted Answer

A)  time ticket 
B)  materials requisition form 
C)  job-order cost sheet 
D)  None of these are correct. 
E)  All of these are correct. 
A)  time ticket 
B)  materials requisition form 
C)  job-order cost sheet 
D)  None of these are correct. 
E)  All of these are correct.

Question 18

When the work-in-process account is debited for direct labor, what account is usually credited?

Accepted Answer

A)  Cost of Goods Sold 
B)  Sales Revenue 
C)  Wages Payable 
D)  Overhead Control 
E)  Accounts Receivable 
A)  Cost of Goods Sold 
B)  Sales Revenue 
C)  Wages Payable 
D)  Overhead Control 
E)  Accounts Receivable

Question 19

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 John's operating income for the month of September?

Accepted Answer

A)  $127.40 
B)  $8,206.40 
C)  $3,077.40 
D)  $0 
E)  None of these. 
A)  $127.40 
B)  $8,206.40 
C)  $3,077.40 
D)  $0 
E)  None of these.

Question 20

Figure 5-2.At the beginning of the year, Kyla Inc. estimated that overhead would be $880,000 and direct labor hours would be 220,000. At the end of the year, actual overhead was $920,600 and there were actually 230,000 direct labor hours.
-Refer to Figure 5-2. What is the predetermined overhead rate?

Accepted Answer

A)  $4 per direct labor hour 
B)  $2.63 per direct labor hour 
C)  $4.18 per direct labor hour 
D)  $880,000 
E)  None of these are correct. 
A)  $4 per direct labor hour 
B)  $2.63 per direct labor hour 
C)  $4.18 per direct labor hour 
D)  $880,000 
E)  None of these are correct.

The predetermined overhead rate is calculated by

Which of the following is true about the job-order cost sheet?

Match each item with the correct statement below. -A single overhead rate calculated using all estimated overhead for a factory divided by the estimated activity level across the entire factory

the costs of job are transferred from the work-in-process account to finished goods account

On February 1, Job 12 had a beginning balance of $200. During February, direct materials of $500 and direct labor of $200 were added to the job. Overhead is applied to production at a rate of 55% of direct labor. There are 5 units in Job 12. What is the unit cost?

Manufacturing and service firms producing unique products or services require job-order accounting systems.

Figure 5-9.Warwick Company has the following transactions for the month of September: Balances at the beginning of the month were: -Refer to Figure 5-9. What is the correct journal entry to record actual overhead for the month?

Which of the following is not true about job-order costing?

Which of the following is not a characteristic of job-order costing?

In an actual cost system, actual direct materials, actual direct labor and estimated overhead are used to determine unit cost.

Departmental overheads cannot be added together to get plantwide overhead.

If actual overhead is greater than applied overhead, the variance is called underapplied overhead.

Using normal costing, which costs never enter the work-in-process account?

Which form asks for type, quantity, unit price of direct materials issued, and for the number of the job?

When the work-in-process account is debited for direct labor, what account is usually credited?

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing, and Inventory Management

Profit Planning

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 5: Job-Order Costing

The predetermined overhead rate is calculated by

Which of the following is true about the job-order cost sheet?

Match each item with the correct statement below. -A single overhead rate calculated using all estimated overhead for a factory divided by the estimated activity level across the entire factory

the costs of job are transferred from the work-in-process account to finished goods account

On February 1, Job 12 had a beginning balance of $200. During February, direct materials of $500 and direct labor of $200 were added to the job. Overhead is applied to production at a rate of 55% of direct labor. There are 5 units in Job 12. What is the unit cost?

Manufacturing and service firms producing unique products or services require job-order accounting systems.

Figure 5-9.Warwick Company has the following transactions for the month of September: Balances at the beginning of the month were: -Refer to Figure 5-9. What is the correct journal entry to record actual overhead for the month?

Which of the following is not true about job-order costing?

Which of the following is not a characteristic of job-order costing?

In an actual cost system, actual direct materials, actual direct labor and estimated overhead are used to determine unit cost.

Departmental overheads cannot be added together to get plantwide overhead.

If actual overhead is greater than applied overhead, the variance is called underapplied overhead.

Using normal costing, which costs never enter the work-in-process account?

Which form asks for type, quantity, unit price of direct materials issued, and for the number of the job?

When the work-in-process account is debited for direct labor, what account is usually credited?

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing, and Inventory Management

Profit Planning

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Statement of Cash Flows

Financial Statement Analysis

Filters