Question 1

The debit to factory overhead for the cost of indirect materials is obtained from the summary of the materials requisitions.

Accepted Answer

A) True 
 B)False

Question 2

At the end of July, the first month of the current fiscal year, the factory overhead account had a debit balance. Which of the following describes the nature of this balance and how it would be reported on the interim balance sheet?

Accepted Answer

A)  Overapplied, deferred credit 
B)  Underapplied, deferred debit 
C)  Underapplied, deferred credit 
D)  Overapplied, deferred debit 
A)  Overapplied, deferred credit 
B)  Underapplied, deferred debit 
C)  Underapplied, deferred credit 
D)  Overapplied, deferred debit

Question 3

In a job order cost accounting system, the entry to record the flow of direct materials into production is:

Accepted Answer

A)  debit Work in Process, credit Materials 
B)  debit Materials, credit Work in Process 
C)  debit Factory Overhead, credit Materials 
D)  debit Work in Process, credit Supplies 
A)  debit Work in Process, credit Materials 
B)  debit Materials, credit Work in Process 
C)  debit Factory Overhead, credit Materials 
D)  debit Work in Process, credit Supplies

Question 4

Materials purchased on account during the month amounted to $180,000. Materials requisitioned and placed in production totaled $165,000. From the following, select the entry to record the transaction on the day the materials were requisitioned by the production department.

Accepted Answer

A)  
  
B) 
   
C)  
  
D) 
  
A)  
  
B) 
   
C)  
  
D)

Question 5

Job order cost systems can be used to compare unit costs of similar jobs to determine if costs are staying within expected ranges.

Accepted Answer

A) True 
 B)False

Question 6

When a job is completed in a service organization, the job costs are transferred to the

Accepted Answer

A)  work in process account. 
B)  cost of services account. 
C)  finished goods account. 
D)  cost of goods sold account. 
A)  work in process account. 
B)  cost of services account. 
C)  finished goods account. 
D)  cost of goods sold account.

Question 7

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 the ending balance of Cost of Goods sold for Zeke Company as of the end of the 1st quarter?

Accepted Answer

A)  $456 
B)  $2,685 
C)  $1,685 
D)  $685 
A)  $456 
B)  $2,685 
C)  $1,685 
D)  $685

Question 8

The direct labor and overhead costs of providing services to clients are accumulated in:

Accepted Answer

A)  finished services expense 
B)  work in process 
C)  administrative salaries expense 
D)  overhead 
A)  finished services expense 
B)  work in process 
C)  administrative salaries expense 
D)  overhead

Question 9

Which of the following would most likely be a period cost?

Accepted Answer

A)  Depreciation on factory lunchroom furniture. 
B)  Salary of telephone receptionist in the sales office. 
C)  Salary of a security guard for the factory parking lot. 
D)  Computer chips used by a computer manufacturer. 
A)  Depreciation on factory lunchroom furniture. 
B)  Salary of telephone receptionist in the sales office. 
C)  Salary of a security guard for the factory parking lot. 
D)  Computer chips used by a computer manufacturer.

Question 10

The following is a list of costs incurred by several business organizations:
   Classify each of the preceding costs as product costs or period costs. For those costs classified as product costs, indicate whether the product cost is a direct materials cost, direct labor cost, or factory overhead cost. For those costs classified as period costs, indicate whether the period cost is a selling expense or an administrative expense. Use the following tabular headings for preparing your answer. Place an X in the appropriate column.

Accepted Answer

The answer of The following is a list of costs...

Question 11

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

Accepted Answer

A) True 
 B)False

Question 12

The cost of production of completed and finished goods during the period amounted to $450,000, and the finished products shipped to customers had total production costs of $357,000. From the following, select the entry to record the transfer of costs from finished goods to cost of goods sold.

Accepted Answer

A)  
  
B) 
  
C)  
  
D) 
  
A)  
  
B) 
  
C)  
  
D)

Question 13

Select the proper journal entry to record the movement of 1,700 units of part number 116B to work in process when each unit of 116B has a value of $2.00.

Accepted Answer

A)  
  
B)  
  
C)  
  
D)  
  
A)  
  
B)  
  
C)  
  
D)

Question 14

At the end of the period, Carson Company had the following balances in selected accounts:
   Required:
a. Assuming the factory overhead balance is relatively small, prepare the journal entry to close the Factory Overhead account if the balance in the account is a debit balance. What does a debit balance mean?
b. Assuming the factory overhead balance is relatively small, prepare the journal entry to close the Factory Overhead account if the balance in the account is a credit balance. What does a credit balance mean?

Accepted Answer

a. 
@#IMG-DLM&
This means underapplied o

Question 15

Interim financial statements for a manufacturing business would report overapplied factory overhead as a deferred item on the balance sheet.

Accepted Answer

A) True 
 B)False

Question 16

In a job order cost accounting system, when goods that have been ordered are received, the receiving department personnel count, inspect the goods, and complete a:

Accepted Answer

A)  purchase order 
B)  sales invoice 
C)  receiving report 
D)  purchase requisition 
A)  purchase order 
B)  sales invoice 
C)  receiving report 
D)  purchase requisition

Question 17

The recording of the jobs completed would include a debit to:

Accepted Answer

A)  Factory Overhead 
B)  Finished Goods 
C)  Work in Process 
D)  Cost of Goods Sold 
A)  Factory Overhead 
B)  Finished Goods 
C)  Work in Process 
D)  Cost of Goods Sold

Question 18

Six selected transactions for the current month are indicated by letters in the following T accounts in a job order cost accounting system:

Describe each of the six transactions.

Accepted Answer

The answer of Six selected transactions for the current month...

Question 19

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 $1,348,800.
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.

Accepted Answer

a) 54,300 hours * $25 = $1,357

Question 20

A manufacturer may employ a job order cost system for some of its products and a process cost system for others.

Accepted Answer

A) True 
 B)False

Exam 17: Job Order Costing

The debit to factory overhead for the cost of indirect materials is obtained from the summary of the materials requisitions.

At the end of July, the first month of the current fiscal year, the factory overhead account had a debit balance. Which of the following describes the nature of this balance and how it would be reported on the interim balance sheet?

In a job order cost accounting system, the entry to record the flow of direct materials into production is:

Materials purchased on account during the month amounted to $180,000. Materials requisitioned and placed in production totaled $165,000. From the following, select the entry to record the transaction on the day the materials were requisitioned by the production department.

Job order cost systems can be used to compare unit costs of similar jobs to determine if costs are staying within expected ranges.

When a job is completed in a service organization, the job costs are transferred to the

The direct labor and overhead costs of providing services to clients are accumulated in:

Which of the following would most likely be a period cost?

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

The cost of production of completed and finished goods during the period amounted to $450,000, and the finished products shipped to customers had total production costs of $357,000. From the following, select the entry to record the transfer of costs from finished goods to cost of goods sold.

Select the proper journal entry to record the movement of 1,700 units of part number 116B to work in process when each unit of 116B has a value of $2.00.

Interim financial statements for a manufacturing business would report overapplied factory overhead as a deferred item on the balance sheet.

In a job order cost accounting system, when goods that have been ordered are received, the receiving department personnel count, inspect the goods, and complete a:

The recording of the jobs completed would include a debit to:

Six selected transactions for the current month are indicated by letters in the following T accounts in a job order cost accounting system: Describe each of the six transactions.

A manufacturer may employ a job order cost system for some of its products and a process cost system for others.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting Concepts and Principles

Process Cost Systems

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing for Management Analysis

Budgeting

Performance Evaluation Using Variances From Standard Costs

Performance Evaluation for Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

Cost Management for Just-In-Time Environments

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