Question 1

The Cost of Goods Sold account tracks job costs from the time jobs are started until they are completed.

Accepted Answer

A) True 
 B)False

Question 2

The proration approach to allocating overapplied or underapplied overhead adjusts individual job-cost records.

Accepted Answer

A) True 
 B)False

Question 3

What is the profit margin earned if each unit requires two machine-hours?

Accepted Answer

A)  53.33% 
B)  33.33% 
C)  66.67% 
D)  58.73% 
A)  53.33% 
B)  33.33% 
C)  66.67% 
D)  58.73%

Question 4

Process costing is ________.

Accepted Answer

A)  used to enhance employees' job satisfaction 
B)  used by businesses to price unique products or identical products produced in batches 
C)  used by businesses to price identical products 
D)  used by businesses when manufacturing goods above normal capacity 
A)  used to enhance employees' job satisfaction 
B)  used by businesses to price unique products or identical products produced in batches 
C)  used by businesses to price identical products 
D)  used by businesses when manufacturing goods above normal capacity

Question 5

When a job is complete ________.

Accepted Answer

A)  actual indirect manufacturing labor is excluded from the total cost of the job 
B)  Finished Goods Control is debited 
C)  the cost of the job is transferred to Manufacturing Overhead Control 
D)  it is reduced from Manufacturing Overhead Control account 
A)  actual indirect manufacturing labor is excluded from the total cost of the job 
B)  Finished Goods Control is debited 
C)  the cost of the job is transferred to Manufacturing Overhead Control 
D)  it is reduced from Manufacturing Overhead Control account

Question 6

One reason for using longer time periods to calculate indirect-cost rates is seasonal cost fluctuations.

Accepted Answer

A) True 
 B)False

Question 7

Answer the following questions using the information below:
For 2014, Thomas Manufacturing uses machine-hours as the only overhead cost-allocation base. The estimated manufacturing overhead costs are $300,000 and estimated machine hours are 50,000. The actual manufacturing overhead costs are $420,000 and actual machine hours are 70,000.
-Using job costing,the 2014 budgeted manufacturing overhead rate is ________.

Accepted Answer

A)  $6.50 per machine-hour 
B)  $4.80 per machine-hour 
C)  $5.50 per machine-hour 
D)  $6.00 per machine-hour 
A)  $6.50 per machine-hour 
B)  $4.80 per machine-hour 
C)  $5.50 per machine-hour 
D)  $6.00 per machine-hour

Question 8

The actual indirect-cost rate is calculated by ________.

Accepted Answer

A)  dividing actual total indirect costs by the actual total quantity of the cost-allocation base 
B)  multiplying actual total indirect costs by the actual total quantity of the cost-allocation base 
C)  dividing the actual total quantity of the cost allocation base by actual total indirect costs 
D)  multiplying the actual total quantity of the cost allocation base by actual total indirect costs 
A)  dividing actual total indirect costs by the actual total quantity of the cost-allocation base 
B)  multiplying actual total indirect costs by the actual total quantity of the cost-allocation base 
C)  dividing the actual total quantity of the cost allocation base by actual total indirect costs 
D)  multiplying the actual total quantity of the cost allocation base by actual total indirect costs

Question 9

The Materials Control account is increased when ________.

Accepted Answer

A)  direct materials are purchased 
B)  indirect materials are sold 
C)  materials are requisitioned for production 
D)  materials are converted to finished goods 
A)  direct materials are purchased 
B)  indirect materials are sold 
C)  materials are requisitioned for production 
D)  materials are converted to finished goods

Question 10

The ending balance in the Work-in-Process Control account represents the costs of all jobs that ________.

Accepted Answer

A)  have not been completed 
B)  have been completed but not sold 
C)  have been completed and sold to customers 
D)  are reported on the income statement 
A)  have not been completed 
B)  have been completed but not sold 
C)  have been completed and sold to customers 
D)  are reported on the income statement

Question 11

A job-cost sheet details the ________.

Accepted Answer

A)  direct materials purchased and paid 
B)  direct labor costs incurred 
C)  indirect labor costs incurred 
D)  actual indirect overhead costs incurred 
A)  direct materials purchased and paid 
B)  direct labor costs incurred 
C)  indirect labor costs incurred 
D)  actual indirect overhead costs incurred

Question 12

Which of the following statements about actual costing is true?

Accepted Answer

A)  Manufacturing costs of a job are available earlier under actual costing. 
B)  Corrective actions can be implemented sooner under actual costing. 
C)  Actual costing uses budgeted indirect-cost rates calculated annually. 
D)  Actual costing uses actual indirect-cost rates calculated annually. 
A)  Manufacturing costs of a job are available earlier under actual costing. 
B)  Corrective actions can be implemented sooner under actual costing. 
C)  Actual costing uses budgeted indirect-cost rates calculated annually. 
D)  Actual costing uses actual indirect-cost rates calculated annually.

Question 13

Each cost pool may have multiple cost allocation bases.

Accepted Answer

A) True 
 B)False

Question 14

Oil refining companies primarily use job costing to estimate costs.

Accepted Answer

A) True 
 B)False

Question 15

A materials-requisition record is an example of a source document.

Accepted Answer

A) True 
 B)False

Question 16

Answer the following questions using the information below:
Apple Valley Corporation uses a job cost system and has two production departments, A and B. Budgeted manufacturing costs for the year are:
 $\begin{array}{lll}&\text { Department A }&\text { Department B }\
\text { Direct materials } & \$ 700,000 & \$ 100,000 \
\text { Direct manufacturing labor } & \$ 200,000 & \$ 800,000 \
\text { Manufacturing overhead } & \$ 600,000 & \$ 400,000
\end{array}$
$\text { The actual material and labor costs charged to Job \#432 were as follows: }$
$\begin{array}{lr}
\text { Direct materials: } & \$ 25,000 \
\text { Direct labor: } & \
\text { Department A } & \$ 8,000 \
\text { Department B } & \$ 12,000 \
& \$ 20,000
\end{array}$ Apple Valley applies manufacturing overhead costs to jobs on the basis of direct manufacturing labor cost using departmental rates determined at the beginning of the year.
-Manufacturing overhead costs allocated to Job #432 total ________.

Accepted Answer

A)  $30,000 
B)  $12,000 
C)  $24,000 
D)  $36,000 
A)  $30,000 
B)  $12,000 
C)  $24,000 
D)  $36,000

Question 17

Payment of the factory rent increases the ________.

Accepted Answer

A)  Work-in-Process Control account 
B)  Manufacturing Overhead Control account 
C)  Cost of Goods Sold account 
D)  Factory Depreciation account 
A)  Work-in-Process Control account 
B)  Manufacturing Overhead Control account 
C)  Cost of Goods Sold account 
D)  Factory Depreciation account

Question 18

In some variations of normal costing,organizations use budgeted rates to assign direct costs as well as indirect costs to jobs.

Accepted Answer

A) True 
 B)False

Question 19

Answer the following questions using the information below:
Bauer Manufacturing uses departmental cost driver rates to allocate manufacturing overhead costs to products. Manufacturing overhead costs are allocated on the basis of machine-hours in the Machining Department and on the basis of direct labor-hours in the Assembly Department. At the beginning of 20X3, the following estimates were provided for the coming year:
 $\begin{array}{lrr}&\text { Machining }&\text { Assembly }\
\text { Direct labor-hours } & 30,000 & 60,000 \
\text { Machine-hours } & 80,000 & 20,000 \
\text { Direct labor cost } & \$ 500,000 & \$ 900,000 \
\text { Manufacturing overhead costs } & \$ 420,000 & \$ 240,000
\end{array}$ The accounting records of the company show the following data for Job #316:
 $$\begin{array} { l r r } 
& \text { Machining } & \text { Assembly } \
\text { Direct labor-hours } & 120 & 70 \
\text { Machine-hours } & 60 & 5 \
\text { Direct material cost } & \$ 300 & \$ 200 \
\text { Direct labor cost } & \$ 100 & \$ 400
\end{array}$$
-For Bauer Manufacturing,what is the annual manufacturing overhead cost-allocation rate for the Machining Department?

Accepted Answer

A)  $4.00 
B)  $4.20 
C)  $4.67 
D)  $5.25 
A)  $4.00 
B)  $4.20 
C)  $4.67 
D)  $5.25

Question 20

Which of the following increases (are debited to)the Work-in-Process Control account?

Accepted Answer

A)  actual plant insurance costs 
B)  customer services costs 
C)  marketing expenses 
D)  direct manufacturing labor costs 
A)  actual plant insurance costs 
B)  customer services costs 
C)  marketing expenses 
D)  direct manufacturing labor costs

The Cost of Goods Sold account tracks job costs from the time jobs are started until they are completed.

The proration approach to allocating overapplied or underapplied overhead adjusts individual job-cost records.

What is the profit margin earned if each unit requires two machine-hours?

Process costing is ________.

When a job is complete ________.

One reason for using longer time periods to calculate indirect-cost rates is seasonal cost fluctuations.

The actual indirect-cost rate is calculated by ________.

The Materials Control account is increased when ________.

The ending balance in the Work-in-Process Control account represents the costs of all jobs that ________.

A job-cost sheet details the ________.

Which of the following statements about actual costing is true?

Each cost pool may have multiple cost allocation bases.

Oil refining companies primarily use job costing to estimate costs.

A materials-requisition record is an example of a source document.

Payment of the factory rent increases the ________.

In some variations of normal costing,organizations use budgeted rates to assign direct costs as well as indirect costs to jobs.

Which of the following increases (are debited to)the Work-in-Process Control account?

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Activity-Based Costing and Activity-Based Management

Master Budget and Responsibility Accounting

Flexible Budgets, direct-Cost Variances, and Management Control

Flexible Budgets, overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Strategy, balanced Scorecard, and Strategic Profitability Analysis

Pricing Decisions and Cost Management

Cost Allocation, customer-Profitability Analysis, and Sales-Variance Analysis

Allocation of Support-Department Costs, common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, rework, and Scrap

Balanced Scorecard: Quality and Time

Inventory Management, just-In-Time, and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, transfer Pricing, and Multinational Considerations

Performance Measurement, compensation, and Multinational Considerations

Filters

Exam 4: Job Costing

The Cost of Goods Sold account tracks job costs from the time jobs are started until they are completed.

The proration approach to allocating overapplied or underapplied overhead adjusts individual job-cost records.

What is the profit margin earned if each unit requires two machine-hours?

Process costing is ________.

When a job is complete ________.

One reason for using longer time periods to calculate indirect-cost rates is seasonal cost fluctuations.

The actual indirect-cost rate is calculated by ________.

The Materials Control account is increased when ________.

The ending balance in the Work-in-Process Control account represents the costs of all jobs that ________.

A job-cost sheet details the ________.

Which of the following statements about actual costing is true?

Each cost pool may have multiple cost allocation bases.

Oil refining companies primarily use job costing to estimate costs.

A materials-requisition record is an example of a source document.

Payment of the factory rent increases the ________.

In some variations of normal costing,organizations use budgeted rates to assign direct costs as well as indirect costs to jobs.

Which of the following increases (are debited to)the Work-in-Process Control account?

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Activity-Based Costing and Activity-Based Management

Master Budget and Responsibility Accounting

Flexible Budgets, direct-Cost Variances, and Management Control

Flexible Budgets, overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Strategy, balanced Scorecard, and Strategic Profitability Analysis

Pricing Decisions and Cost Management

Cost Allocation, customer-Profitability Analysis, and Sales-Variance Analysis

Allocation of Support-Department Costs, common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, rework, and Scrap

Balanced Scorecard: Quality and Time

Inventory Management, just-In-Time, and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, transfer Pricing, and Multinational Considerations

Performance Measurement, compensation, and Multinational Considerations

Filters