Exam 4: Job Costing

A local accounting firm employs 28 full-time professionals.The budgeted annual compensation per employee is $41,000.The average chargeable time is 430 hours per client annually.All professional labor costs are included in a single direct-cost category and are allocated to jobs on a per-hour basis. Other costs are included in a single indirect-cost pool,allocated according to professional labor-hours.Budgeted indirect costs for the year are $787,000,and the firm expects to have 95 clients during the coming year. What is the budgeted indirect-cost rate per hour?

Which of the following statements regarding manufacturing overhead allocation is true?

Direct costs of a cost object are costs related to a particular cost object that can be allocated to that cost object in an economically feasible (cost-effective)way.

Manufacturing overhead costs incurred for the month are: Which account is debited assuming utilities and repairs were on account?

A manufacturer estimates that it will incur variable indirect costs for the month of October of $70,000 and $30,000 of fixed costs.The company uses direct labor hours to calculate the predetermined overhead rate and predicted that 3,000 direct labor hours would be used in October.Actual direct labor hours amounted to 3,200. Required: A)What is the variable predetermined indirect rate for October? B)What is the fixed predetermined indirect cost rate for October? C)What is the total allocation rate per direct labor hour for October?

The method that restates all overhead entries in the general ledger and subsidiary ledgers using actual cost rates rather than budgeted cost rates is called ________.

River Falls Manufacturing uses a normal cost system and had the following data available for 2018: The ending balance of direct materials inventory is ________.

Oil refining companies primarily use job costing to estimate costs.

Job-cost records for Boucher Company contained the following data: Required: a.Compute WIP inventory at June 30. b.Compute finished goods inventory at June 30. c.Compute cost of goods sold for June.

Sky High Company has two departments,X and Y.The following estimates are for the coming year: The budgeted indirect-cost driver rate for Y based on the number of machine-hours is in excess of X by ________.(Round interim and the final answer to the nearest cent. )

Which of the following are reasons for using longer periods,such as a year,to calculate indirect cost rates?

The formula for the predetermined indirect cost rate is:

Indirect manufacturing costs are credited to Manufacturing Overhead Control.

Sky High Company has two departments,X and Y.The following estimates are for the coming year: A single indirect-cost rate based on direct manufacturing labor-hours for the entire plant is ________.

The budgeted indirect cost rate is actual indirect costs divided by budgeted quantity of the cost allocation base.

Normal costing assigns indirect costs based on an actual indirect-cost rate.

The basic source document for direct manufacturing labor is the ________.

The accounting firm firm of Smith & Jones LLC has a staff of 34 staff accountants and auditors and administrative staff.Budgeted total costs of the firm total $5,000,000 of which $2,900,000 is direct-labor costs.Assuming that the remaining costs are indirect and direct-labor cost is the allocation base,calculate the budgeted indirect cost rate.

Under the proration approach,the sum of the amounts shown in the subsidiary ledgers will not match the amounts shown in the general ledger because no adjustments from budgeted to actual manufacturing overhead rates are made in the individual job-cost records.

An example of a denominator reason for calculating annual indirect-cost rates includes ________.