Question 1

Job costing is often used by professional service providers, such as law firms.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is an example of an industry that would use a process costing-rather than a job costing-system?

Accepted Answer

A) Brugman Custom Cabinetry 
B) Computer Repair 
C) Pepsi 
D) Smith & Zu Certified Public Accountants 
A) Brugman Custom Cabinetry 
B) Computer Repair 
C) Pepsi 
D) Smith & Zu Certified Public Accountants

Question 3

Here are selected basic data for Wilson Company:   If the company allocates overhead based on direct labor cost, what are the total actual manufacturing overhead costs?

Accepted Answer

A) $283,400 
B) $173,000 
C) $260,600 
D) $229,100 
A) $283,400 
B) $173,000 
C) $260,600 
D) $229,100

Question 4

Biltz Company uses a predetermined overhead rate based on direct labor hours to allocate manufacturing overhead to jobs. During the year, the company actually incurred manufacturing overhead costs of $582,100 and 135,200 direct labor hours were worked. The company estimated that it would incur $525,700 of manufacturing overhead during the year and that 150,100 direct labor hours would be worked. By how much was manufacturing overhead overallocated or underallocated for the year? (Round intermediary calculations to the nearest cent.)

Accepted Answer

A) $56,400 overallocated 
B) $56,400 undererallocated 
C) $108,900 underallocated 
D) $108,900 overallocated 
A) $56,400 overallocated 
B) $56,400 undererallocated 
C) $108,900 underallocated 
D) $108,900 overallocated

Question 5

A service firm's costs are comprised of direct materials, direct labor and manufacturing overhead.

Accepted Answer

A) True 
 B)False

Question 6

Under a perpetual inventory system, the journal entry needed to record the sale of a job includes a

Accepted Answer

A) debit to Cost of Goods Sold account and credit to Sales Revenue account. 
B) debit to Finished Goods Inventory account and credit to Cost of Goods Sold account. 
C) debit to Sales Revenue account and credit to Accounts Receivable account. 
D) debit to Accounts Receivable account and credit to Sales Revenue account. 
A) debit to Cost of Goods Sold account and credit to Sales Revenue account. 
B) debit to Finished Goods Inventory account and credit to Cost of Goods Sold account. 
C) debit to Sales Revenue account and credit to Accounts Receivable account. 
D) debit to Accounts Receivable account and credit to Sales Revenue account.

Question 7

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

Accepted Answer

A) True 
 B)False

Question 8

Manufacturing overhead may include depreciation on the factory plant and equipment, utilities to run the plant, property taxes and insurance on the plant, and salaries of plant janitors.

Accepted Answer

A) True 
 B)False

Question 9

Underallocated manufacturing overhead results when

Accepted Answer

A) production is greater than last year. 
B) actual overhead is greater than expected. 
C) actual overhead is greater than allocated overhead. 
D) estimated overhead is greater than actual overhead. 
A) production is greater than last year. 
B) actual overhead is greater than expected. 
C) actual overhead is greater than allocated overhead. 
D) estimated overhead is greater than actual overhead.

Question 10

Generally Accepted Accounting Principles (GAAP)mandates the type of product costing system (job costing or process costing)that must be used by a manufacturer.

Accepted Answer

A) True 
 B)False

Question 11

The cost of direct materials used in production is debited to

Accepted Answer

A) either Manufacturing Overhead account or Work-in-Process Inventory account. 
B) Finished Goods Inventory account. 
C) Work-in-Process Inventory account. 
D) Manufacturing Overhead account. 
A) either Manufacturing Overhead account or Work-in-Process Inventory account. 
B) Finished Goods Inventory account. 
C) Work-in-Process Inventory account. 
D) Manufacturing Overhead account.

Question 12

Overallocated and underallocated manufacturing overhead is calculated by comparing allocated manufacturing overhead to actual manufacturing overhead.

Accepted Answer

A) True 
 B)False

Question 13

Green Products Manufacturing uses job costing. In May, material requisitions were $44,700 ($39,500 of these were direct materials), and raw material purchases were $60,200. The end of month balance in raw materials inventory was $24,800. What was the beginning raw materials inventory balance?

Accepted Answer

A) $74,900 
B) $45,500 
C) $9300 
D) $24,000 
A) $74,900 
B) $45,500 
C) $9300 
D) $24,000

Question 14

The entry to record the purchase of raw materials on account using a job costing system would include a

Accepted Answer

A) credit to Work-in-Process Inventory account. 
B) debit to Accounts Payable account. 
C) debit to Work-in-Process Inventory account. 
D) debit to Raw Materials Inventory account. 
A) credit to Work-in-Process Inventory account. 
B) debit to Accounts Payable account. 
C) debit to Work-in-Process Inventory account. 
D) debit to Raw Materials Inventory account.

Question 15

State whether each company below would be more likely to use a job costing system or a process costing system.
A)________ soft drink bottler
B)________ yacht builder
C)________ hospital
D)________ printing firm
E)________ flour mill

Accepted Answer

A)process costing
B)

Question 16

Maple Company uses a job costing system. Maple Company's schedule of cost of goods manufactured showed the following amounts for the month ended August 31.   Allocated manufacturing overhead costs for August amount to $50,100.
What is the amount of work in process inventory (before any adjustment for overallocated or underallocated manufacturing overhead)on August 31?

Accepted Answer

A) $59,400 
B) 169,500 
C) 35,500 
D) 139,300 
A) $59,400 
B) 169,500 
C) 35,500 
D) 139,300

Question 17

The journal entries needed for job costing at a service company

Accepted Answer

A) are more complicated than those needed at a manufacturing company. 
B) are virtually the same as those needed at a manufacturing company. 
C) include the movement of inventory. 
D) are simpler than those needed at a manufacturing company. 
A) are more complicated than those needed at a manufacturing company. 
B) are virtually the same as those needed at a manufacturing company. 
C) include the movement of inventory. 
D) are simpler than those needed at a manufacturing company.

Question 18

Tina's Interior Design expects its designers will work a total of 14,000 direct labor hours during the upcoming year. Tina's estimated total indirect costs are $168,000. The indirect cost allocation rate is based on direct labor hours.
A. What is the indirect cost allocation rate?
B. What indirect costs will be allocated to client 332, if one designer works 25 hours?

Accepted Answer

The answer of Tina's Interior Design expects its designers will...

Question 19

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

Accepted Answer

A) Overhead costing system 
B) Job costing system 
C) Process costing system 
D) Product costing system 
A) Overhead costing system 
B) Job costing system 
C) Process costing system 
D) Product costing system

Question 20

A company has overallocated manufacturing overhead by $2100. The entry to close manufacturing overhead account would be to

Accepted Answer

A) debit Manufacturing Overhead account and credit Cost of Goods Sold account for $2100. 
B) debit Manufacturing Overhead account and credit Work-in-Process account for $2100. 
C) debit Cost of Goods Sold account and credit Manufacturing Overhead account for $2100. 
D) debit Cost of Goods Sold account and credit Finished Goods Inventory account for $2100. 
A) debit Manufacturing Overhead account and credit Cost of Goods Sold account for $2100. 
B) debit Manufacturing Overhead account and credit Work-in-Process account for $2100. 
C) debit Cost of Goods Sold account and credit Manufacturing Overhead account for $2100. 
D) debit Cost of Goods Sold account and credit Finished Goods Inventory account for $2100.

Job costing is often used by professional service providers, such as law firms.

Which of the following is an example of an industry that would use a process costing-rather than a job costing-system?

Here are selected basic data for Wilson Company: If the company allocates overhead based on direct labor cost, what are the total actual manufacturing overhead costs?

A service firm's costs are comprised of direct materials, direct labor and manufacturing overhead.

Under a perpetual inventory system, the journal entry needed to record the sale of a job includes a

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

Manufacturing overhead may include depreciation on the factory plant and equipment, utilities to run the plant, property taxes and insurance on the plant, and salaries of plant janitors.

Underallocated manufacturing overhead results when

Generally Accepted Accounting Principles (GAAP)mandates the type of product costing system (job costing or process costing)that must be used by a manufacturer.

The cost of direct materials used in production is debited to

Overallocated and underallocated manufacturing overhead is calculated by comparing allocated manufacturing overhead to actual manufacturing overhead.

Green Products Manufacturing uses job costing. In May, material requisitions were $44,700 ($39,500 of these were direct materials), and raw material purchases were $60,200. The end of month balance in raw materials inventory was $24,800. What was the beginning raw materials inventory balance?

The entry to record the purchase of raw materials on account using a job costing system would include a

State whether each company below would be more likely to use a job costing system or a process costing system. A) soft drink bottler B) yacht builder C) hospital D) printing firm E) flour mill

The journal entries needed for job costing at a service company

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

A company has overallocated manufacturing overhead by $2100. The entry to close manufacturing overhead account would be to

Introduction to Managerial Accounting

Building Blocks of Managerial Accounting

Activity-Based Costing, Lean Operations, and the Costs of Quality

Process Costing

Cost Behavior

Cost-Volume-Profit Analysis

Relevant Costs for Short-Term Decisions

The Master Budget

Performance Evalulation

Standard Costs and Variances

Capital Investment Decisions and the Time Value of Money

Statement of Cash Flows

Financial Statement Analysis

Sustainability

Filters

Exam 3: Job Costing

Job costing is often used by professional service providers, such as law firms.

Which of the following is an example of an industry that would use a process costing-rather than a job costing-system?

Here are selected basic data for Wilson Company: If the company allocates overhead based on direct labor cost, what are the total actual manufacturing overhead costs?

A service firm's costs are comprised of direct materials, direct labor and manufacturing overhead.

Under a perpetual inventory system, the journal entry needed to record the sale of a job includes a

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

Manufacturing overhead may include depreciation on the factory plant and equipment, utilities to run the plant, property taxes and insurance on the plant, and salaries of plant janitors.

Underallocated manufacturing overhead results when

Generally Accepted Accounting Principles (GAAP)mandates the type of product costing system (job costing or process costing)that must be used by a manufacturer.

The cost of direct materials used in production is debited to

Overallocated and underallocated manufacturing overhead is calculated by comparing allocated manufacturing overhead to actual manufacturing overhead.

Green Products Manufacturing uses job costing. In May, material requisitions were $44,700 ($39,500 of these were direct materials), and raw material purchases were $60,200. The end of month balance in raw materials inventory was $24,800. What was the beginning raw materials inventory balance?

The entry to record the purchase of raw materials on account using a job costing system would include a

State whether each company below would be more likely to use a job costing system or a process costing system. A)________ soft drink bottler B)________ yacht builder C)________ hospital D)________ printing firm E)________ flour mill

The journal entries needed for job costing at a service company

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

A company has overallocated manufacturing overhead by $2100. The entry to close manufacturing overhead account would be to

Introduction to Managerial Accounting

Building Blocks of Managerial Accounting

Activity-Based Costing, Lean Operations, and the Costs of Quality

Process Costing

Cost Behavior

Cost-Volume-Profit Analysis

Relevant Costs for Short-Term Decisions

The Master Budget

Performance Evalulation

Standard Costs and Variances

Capital Investment Decisions and the Time Value of Money

Statement of Cash Flows

Financial Statement Analysis

Sustainability

Filters

State whether each company below would be more likely to use a job costing system or a process costing system. A) soft drink bottler B) yacht builder C) hospital D) printing firm E) flour mill