Question 1

The total of the dollar amounts on the job order cost cards that have not been completed would be equal to the

Accepted Answer

A) cost of goods completed. 
B) balance in the Finished Goods Inventory account. 
C) cost of goods sold. 
D) balance in the Work in Process Inventory account. 
A) cost of goods completed. 
B) balance in the Finished Goods Inventory account. 
C) cost of goods sold. 
D) balance in the Work in Process Inventory account.

Question 2

As related to a job order costing system,answer the following questions:
a.What is a job order costing system? Identify three kinds of companies that would use such as system.
b.What is a job order?
c.What is the purpose of a job order cost card? Identify the kinds of information recorded in it.

Accepted Answer

a.A job order costing system is a produc

Question 3

A typical operations costing system for a manufacturer incorporates parts of both job order costing and process costing.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following characteristics applies to process costing,but does not apply to job order costing?

Accepted Answer

A) The use of single Work in Process accounts 
B) The use of equivalent units 
C) Separate,identifiable jobs 
D) The use of predetermined overhead rates 
A) The use of single Work in Process accounts 
B) The use of equivalent units 
C) Separate,identifiable jobs 
D) The use of predetermined overhead rates

Question 5

Financial statements referred by external stakeholders compare actual unit costs with targeted unit costs.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following accurately describes a difference between job order and process costing systems?

Accepted Answer

A) In job order costing systems,overhead costs are treated as product costs,whereas in process costing systems,overhead costs are treated as period costs. 
B) Job order costing systems do not assign costs to production,whereas process costing systems do. 
C) In job order costing systems,costs are traced to a specific job order,whereas in process costing systems,costs are traced to work cells and then assigned to products manufactured. 
D) In a job order costing system,selling costs are treated as period costs,whereas they are treated as product costs in a process costing system. 
A) In job order costing systems,overhead costs are treated as product costs,whereas in process costing systems,overhead costs are treated as period costs. 
B) Job order costing systems do not assign costs to production,whereas process costing systems do. 
C) In job order costing systems,costs are traced to a specific job order,whereas in process costing systems,costs are traced to work cells and then assigned to products manufactured. 
D) In a job order costing system,selling costs are treated as period costs,whereas they are treated as product costs in a process costing system.

Question 7

In a process costing system,product costs are traced to work cells.

Accepted Answer

A) True 
 B)False

Question 8

During the first month of the current accounting period,Southern California Company experienced a devastating loss due to a fire.Many of the accounting records were lost and the company is now trying to recreate the lost information.Fragments of data found include the following:
1.A portion of the budget indicates that the overhead rate was $10 per direct labor hour.
2.Job 74 was in process and had incurred $9,600 of direct materials and $14,000 of direct labor (1,000 hours).The company has a single hourly wage rate.
3.During the month,4,500 direct labor hours were worked.
4.Actual overhead costs were $48,000.No indirect materials were used.
5.The Materials Inventory account had a beginning balance of $28,000 and an ending balance of $18,000.
6.The Finished Goods Inventory account had a beginning balance of $12,000 and an ending balance of $26,000.
7.The Work in Process Inventory account had a beginning balance of $17,000.
8.The Cost of Goods Sold is $171,000.
Calculate the following amounts:
a.Ending work in process inventory account balance,Job No.74
b.Cost of goods completed
c.Amount of overhead under- or overapplied.
d.Direct materials used
e.Direct materials purchased

Accepted Answer

The answer of During the first month of the current...

Question 9

When direct materials are issued from inventory to production under a job order costing system,an increase is recorded in the

Accepted Answer

A) Overhead account. 
B) Work in Process Inventory account. 
C) Materials Inventory account. 
D) Finished Goods Inventory account. 
A) Overhead account. 
B) Work in Process Inventory account. 
C) Materials Inventory account. 
D) Finished Goods Inventory account.

Question 10

Ad-on International is an advertising company.It estimated the overhead costs for March,2014,to be $950,000 and direct labor hours to be 5,000 hours.In March,it incurred overhead costs of $1,150,000 and 5,100 labor hours. 
-What is the overapplied or underapplied overhead for Ad-on International for March,2014?

Accepted Answer

A) $181,000 underapplied 
B) $181,000 overapplied 
C) $19,000 underapplied 
D) $19,000 overapplied 
A) $181,000 underapplied 
B) $181,000 overapplied 
C) $19,000 underapplied 
D) $19,000 overapplied

Question 11

Which of the following cannot be learned by analyzing job order cost cards?

Accepted Answer

A) The balance of Work in Process Inventory at the end of the period 
B) The cost of all jobs done for a particular customer 
C) The completion time of jobs yet to be completed 
D) The type of products ordered by a particular customer 
A) The balance of Work in Process Inventory at the end of the period 
B) The cost of all jobs done for a particular customer 
C) The completion time of jobs yet to be completed 
D) The type of products ordered by a particular customer

Question 12

Job order costing is used by companies that make unique or special-order products.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is not an objective of product costing systems?

Accepted Answer

A) To provide information for cost planning 
B) To assist in the preparation of the income statement 
C) To determine the taxable profits 
D) To provide information for product pricing 
A) To provide information for cost planning 
B) To assist in the preparation of the income statement 
C) To determine the taxable profits 
D) To provide information for product pricing

Question 14

Managers' knowledge on unit cost helps in setting reasonable selling prices for products.

Accepted Answer

A) True 
 B)False

Question 15

Disposing under- or overapplied overhead into the Cost of Goods Sold account is related to _____ in the management process.

Accepted Answer

A) performing 
B) planning 
C) evaluating 
D) communicating 
A) performing 
B) planning 
C) evaluating 
D) communicating

Question 16

The computations for costs to be transferred out of Work in Process Inventory differ if the production process involves multiple departments rather than a single department.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following entities would probably use a process costing system?

Accepted Answer

A) An oil refinery 
B) A yacht builder 
C) A custom furniture company 
D) A custom jewelry manufacturer 
A) An oil refinery 
B) A yacht builder 
C) A custom furniture company 
D) A custom jewelry manufacturer

Question 18

WinLaw is a legal services provider.It is planning to extend its operations by providing tax consultancy services.Which of the following statements will be true if the company extends its operation as planned?

Accepted Answer

A) The cost of providing legal services is high as tax consultancy service will be in its initial stages. 
B) The company cannot extend its operations since it requires additional staff. 
C) The company should know the unit service cost of tax services before determining the fees. 
D) The company should drop this service line if it makes lesser profit than legal services. 
A) The cost of providing legal services is high as tax consultancy service will be in its initial stages. 
B) The company cannot extend its operations since it requires additional staff. 
C) The company should know the unit service cost of tax services before determining the fees. 
D) The company should drop this service line if it makes lesser profit than legal services.

Question 19

In a job order costing system,when overhead costs are applied,they decrease the Work in Process Inventory account.

Accepted Answer

A) True 
 B)False

Question 20

In a job order costing system,when indirect materials are used,the Overhead account is increased.

Accepted Answer

A) True 
 B)False

Exam 18: Costing Systems: Job Order Costing

The total of the dollar amounts on the job order cost cards that have not been completed would be equal to the

As related to a job order costing system,answer the following questions: a.What is a job order costing system? Identify three kinds of companies that would use such as system. b.What is a job order? c.What is the purpose of a job order cost card? Identify the kinds of information recorded in it.

A typical operations costing system for a manufacturer incorporates parts of both job order costing and process costing.

Which of the following characteristics applies to process costing,but does not apply to job order costing?

Financial statements referred by external stakeholders compare actual unit costs with targeted unit costs.

Which of the following accurately describes a difference between job order and process costing systems?

In a process costing system,product costs are traced to work cells.

When direct materials are issued from inventory to production under a job order costing system,an increase is recorded in the

Which of the following cannot be learned by analyzing job order cost cards?

Job order costing is used by companies that make unique or special-order products.

Which of the following is not an objective of product costing systems?

Managers' knowledge on unit cost helps in setting reasonable selling prices for products.

Disposing under- or overapplied overhead into the Cost of Goods Sold account is related to _____ in the management process.

The computations for costs to be transferred out of Work in Process Inventory differ if the production process involves multiple departments rather than a single department.

Which of the following entities would probably use a process costing system?

WinLaw is a legal services provider.It is planning to extend its operations by providing tax consultancy services.Which of the following statements will be true if the company extends its operation as planned?

In a job order costing system,when overhead costs are applied,they decrease the Work in Process Inventory account.

In a job order costing system,when indirect materials are used,the Overhead account is increased.

Accounting Principles and the Financial Statements

Analyzing and Recording Business Transactions

Adjusting the Accounts

Completing the Accounting Cycle

Foundations of Financial Reporting and the Classified Balance Sheet

Accounting for Merchandising Operations

Inventories

Cash and Internal Control

Receivables

Long -Term Assets

Current Liabilities and Fair Value Accounting

Accounting for Partnerships

Accounting for Corporations

Long Term Liabilities

The Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting and Cost Concepts

Costing Systems Process Costing

Value-Based Systems: Activity-Based Costing and Lean Accounting

Cost-Volume-Profit Analysis

The Budgeting Process

Flexible Budgets and Performance Analysis

Standard Costing and Variance Analysis

Short-Run Decision Analysis and Capital Budgeting

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