Exam 5: Systems Design: Job-Order Costing

Sharp Company's records show that overhead was overapplied by $10,000 last year.This overapplied overhead was closed out to the Cost of Goods Sold account at the end of the year.In trying to determine why overhead was overapplied by such a large amount,the company has discovered that $6,000 of depreciation on factory equipment was charged to administrative expense in error.Given the above information,which of the following statements is true?

Under Lamprey Company's job-order costing system,manufacturing overhead is applied to Work in Process inventory using a predetermined overhead rate.During January,Lamprey's transactions included the following: Lamprey Company had no beginning or ending inventories.What was the cost of goods manufactured for January?

Kelly Sportswear manufactures a specialty line of T-shirts.The company uses a job-order costing system.During March,the following costs were incurred on Job 1052: Manufacturing overhead was applied at the rate of $25 per machine hour,and Job 1052 required 800 machine hours.In addition,selling and shipping costs of $7,000 were incurred.Job 1052 consisted of 7,000 shirts and was completed on March 24.The total cost of job 1052 transferred from Work in Process to Finished Goods on March 24 is:

Sawyer Manufacturing Company uses a predetermined overhead rate based on direct labour hours to apply manufacturing overhead to jobs.Last year,the company worked 57,000 actual direct labour hours and used 40,000 machine hours.The company had estimated that it would work 55,000 direct labour hours using 44,000 machine hours during the year and incur $330,000 of manufacturing overhead cost.What was the company's manufacturing overhead applied for the year?

Which of the following would be included in the entry to dispose of the under- or over applied overhead cost for the month?

What was the total amount of direct material purchases during January?

What is the ending Work in Process inventory?

What is the total manufacturing cost for the year?

What is the cost of goods sold?

Dowan Company uses a predetermined overhead rate based on direct labour hours to apply manufacturing overhead to jobs.During the year,Dowan Company incurred $156,600 in actual manufacturing overhead cost.The Manufacturing Overhead account showed that overhead was underapplied by $12,600 for the year.If the predetermined overhead rate is $6.00 per direct labour-hour,how many hours did the company work during the year?

Job-order costing is more likely to be used than process costing in situations where many different products or services are produced each period to customer specifications.

Job cost sheets supporting a normal job-order costing system contain entries for actual direct material,actual direct labour,and actual manufacturing overhead cost incurred in completing a job.

Kelsh Company uses a predetermined overhead rate based on machine hours to apply manufacturing overhead to jobs.The company has provided the following estimated costs for next year: Kelsh estimates that 5,000 direct labour hours and 10,000 machine hours will be worked during the year.What will be the predetermined overhead rate per hour?

)Direct labour cost was $110,000. 8. )Overhead is applied to production on the basis of 65% of direct labour cost. Required: Prepare a schedule of cost of goods manufactured for the month.

What is the cost of goods sold for September (before disposition of any under- or overapplied overhead)?

When the predetermined overhead rate is based on direct labour-hours,the amount of overhead applied to a job is proportional to the amount of actual direct labour-hours incurred on the job.

In a normal job-order costing system,the use of indirect materials would usually be recorded as a debit to which account?

Gilford,Inc. ,uses a job-order costing system.Costs going through the company's work-in-process account during June are listed below.Manufacturing overhead is applied to production using a predetermined overhead rate based on direct labour cost. Only Job 105 was still in process at the end of the month.This job had been charged with $3,000 in direct materials cost. Required: a. )Complete the following for Job 105:

Kanuck Company applies overhead to completed jobs on the basis of $0.70 per machine hour.If Job 501 shows $28,000 of manufacturing overhead applied,how many machine hours were used for the job?

Which entry records the purchase of raw materials?