Exam 17: Job Order Costing

Zeke Company is a manufacturing company that has worked on several production jobs during the 1st quarter of the year. Below is a list of all the jobs for the quarter: Job 356, 357, 358 & 359 were completed. Jobs 356 & 357 were sold at a profit of $500 on each job. What is Gross Margin for Zeke Company as of the end of the 1st quarter?

Cranston Company estimates the following overhead costs for the coming year: Cranston is also budgeting $600,000 in direct labor costs and 15,000 machine hours for the coming year. Required: a. Calculate the predetermined overhead rate using direct labor costs as the allocation base. b. Calculate the predetermined overhead rate using machine hours as the allocation base.

The Winston Company estimates that the factory overhead for the following year will be $1,250,000. The company has decided that the basis for applying factory overhead should be machine hours, which is estimated to be 50,000 hours. The total machine hours for the year was 54,300. The actual factory overhead for the year was $1,375,000. a) Determine the total factory overhead amount applied. b) Calculate the over or under applied amount for the year. c) Prepare the journal entry to close factory overhead into Cost of Goods Sold.

The Tulsa Company allocates overhead based on a predetermined overhead rate of $9.00 per direct labor hour. Job S35 required 8 tons of direct material at a cost of $600.00 per ton and took employees who earn $21.00 per hour a total of 80 hours to complete. What is the total cost of Job S35?

A job order cost accounting system provides for a separate record of the cost of each particular quantity of product that passes through the factory.

The document authorizing the issuance of materials from the storeroom is the:

The process cost system is appropriate where few products are manufactured and each product is made to customers' specifications.

The following budget data are available for Happy Company: If factory overhead is to be applied based on direct labor hours as the cost allocation base for the predetermined overhead rate, the amount of overhead applied into production is

Materials are transferred from the storeroom to the factory in response to materials requisitions.

Cavy Company completed 26,000 units during the year at a cost of $2,139,800. The beginning finished goods inventory was 5,000 units at $405,000. Determine the cost of goods sold for 20,000 units, assuming a FIFO cost flow.

Which of the following represents the factory overhead applied to a product?

Job cost sheets can provide information to managers for all but the following:

Crain Company budgeted 35,000 direct labor hours and incurred 40,000 direct labor hours. It incurred $780,000 of overhead and estimated overhead was $735,000. What is Crain's predetermined overhead rate? Was overhead overapplied or underapplied for the year? By how much?

The materials requisition serves as the source document for debiting the accounts in the materials ledger.

A staff department or unit is one directly involved in the basic objective of the organization.

If the underapplied factory overhead amount is material, it is transferred to Cost of Goods Sold at the end of the fiscal year.

The materials requisition is used to

Each account in the cost ledger in a job order system is called a job cost sheet.

Activity-based costing is a method of accumulating and allocating costs by department.

Discuss the use of job order costing for professional services businesses. What are the similarities and differences between service and manufacturing business job order costing?