Question 1

The finished goods account is the controlling account for the:

Accepted Answer

A)  cost ledger 
B)  materials ledger 
C)  work in process ledger 
D)  stock ledger 
A)  cost ledger 
B)  materials ledger 
C)  work in process ledger 
D)  stock ledger

Question 2

The recording of the jobs shipped and customers billed would include a credit to:

Accepted Answer

A)  Accounts Payable 
B)  Cash 
C)  Finished Goods 
D)  Cost of Goods Sold 
A)  Accounts Payable 
B)  Cash 
C)  Finished Goods 
D)  Cost of Goods Sold

Question 3

Cost accounting systems are used to supply cost data information on costs incurred by a manufacturing process or department.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following is not true about why a service firm will use the job order costing system?

Accepted Answer

A)  to help control costs 
B)  to determine client billing 
C)  to determine department costs within the firm 
D)  to determine profit 
A)  to help control costs 
B)  to determine client billing 
C)  to determine department costs within the firm 
D)  to determine profit

Question 5

Which of the following would be most likely to use process costing?

Accepted Answer

A)  A custom furniture manufacturer. 
B)  An auto body repair shop. 
C)  A law firm 
D)  A lawn fertilizer manufacturer. 
A)  A custom furniture manufacturer. 
B)  An auto body repair shop. 
C)  A law firm 
D)  A lawn fertilizer manufacturer.

Question 6

In a job order cost accounting system for a service business, materials costs are normally included as part of overhead.

Accepted Answer

A) True 
 B)False

Question 7

A widely used activity base for developing factory overhead rates in highly automated settings is:

Accepted Answer

A)  direct labor hours 
B)  direct labor dollars 
C)  direct materials 
D)  machine hours 
A)  direct labor hours 
B)  direct labor dollars 
C)  direct materials 
D)  machine hours

Question 8

Information about costs developed through a job order cost system can not be used to evaluate an organization's cost performance.

Accepted Answer

A) True 
 B)False

Question 9

Job order cost accounting systems can be used only for companies that manufacture a product.

Accepted Answer

A) True 
 B)False

Question 10

The recording of the factory labor incurred for general factory use would include a debit to:

Accepted Answer

A)  Factory Overhead 
B)  Wages Payable 
C)  Wages Expense 
D)  Cost of Goods Sold 
A)  Factory Overhead 
B)  Wages Payable 
C)  Wages Expense 
D)  Cost of Goods Sold

Question 11

The entry to record the flow of direct labor costs into production in a job order cost accounting system is:

Accepted Answer

A)  debit Factory Overhead, credit Work in Process 
B)  debit Finished Goods, credit Wages Payable 
C)  debit Work in Process, credit Wages Payable 
D)  debit Factory Overhead, credit Wages Payable 
A)  debit Factory Overhead, credit Work in Process 
B)  debit Finished Goods, credit Wages Payable 
C)  debit Work in Process, credit Wages Payable 
D)  debit Factory Overhead, credit Wages Payable

Question 12

In a job order cost accounting system used by a service business, which of the following items would normally not be included as part of overhead?

Accepted Answer

A)  Materials 
B)  Direct labor 
C)  Rent 
D)  Supplies 
A)  Materials 
B)  Direct labor 
C)  Rent 
D)  Supplies

Question 13

On the balance sheet for a manufacturing business, the cost of direct materials, direct labor, and factory overhead, which have entered into the manufacturing process but are associated with products that have not been finished, is reported as direct materials inventory.

Accepted Answer

A) True 
 B)False

Question 14

If factory overhead applied exceeds the actual costs, overhead is said to be underapplied.

Accepted Answer

A) True 
 B)False

Question 15

List the accounts used in the cost flow for (a) a manufacturer and (b) a service provider.

Accepted Answer

The answer of List the accounts used in the cost...

Question 16

Present entries to record the following summarized operations related to production for a company using a job order cost system:

Accepted Answer

The answer of Present entries to record the following summarized...

Question 17

The proper journal entry to record the purchase of $30,000 of raw materials on account would be:

Accepted Answer

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

Question 18

Selected accounts with some debits and credits omitted are presented as follows:

If the balance of Work in Process at August 31 is $220,000, what was the amount debited to Work in Process for direct materials in August?

Accepted Answer

A)  $390,000 
B)  $170,000 
C)  $525,000 
D)  $580,000 
A)  $390,000 
B)  $170,000 
C)  $525,000 
D)  $580,000

Question 19

The following are true regarding product costs except

Accepted Answer

A)  product costs are found on the balance sheet until they are sold. 
B)  product costs consist of direct labor, direct materials, and factory overhead. 
C)  product costs can be found in three accounts in the balance sheet. 
D)  product costs include sales and administrative expenses. 
A)  product costs are found on the balance sheet until they are sold. 
B)  product costs consist of direct labor, direct materials, and factory overhead. 
C)  product costs can be found in three accounts in the balance sheet. 
D)  product costs include sales and administrative expenses.

Question 20

The amount of time spent by an employee in the factory is usually recorded on:

Accepted Answer

A)  time tickets 
B)  job order cost sheets 
C)  employees' earnings records 
D)  statement of owners' equity 
A)  time tickets 
B)  job order cost sheets 
C)  employees' earnings records 
D)  statement of owners' equity

Exam 17: Job Order Costing

The finished goods account is the controlling account for the:

The recording of the jobs shipped and customers billed would include a credit to:

Cost accounting systems are used to supply cost data information on costs incurred by a manufacturing process or department.

Which of the following is not true about why a service firm will use the job order costing system?

Which of the following would be most likely to use process costing?

In a job order cost accounting system for a service business, materials costs are normally included as part of overhead.

A widely used activity base for developing factory overhead rates in highly automated settings is:

Information about costs developed through a job order cost system can not be used to evaluate an organization's cost performance.

Job order cost accounting systems can be used only for companies that manufacture a product.

The recording of the factory labor incurred for general factory use would include a debit to:

The entry to record the flow of direct labor costs into production in a job order cost accounting system is:

In a job order cost accounting system used by a service business, which of the following items would normally not be included as part of overhead?

On the balance sheet for a manufacturing business, the cost of direct materials, direct labor, and factory overhead, which have entered into the manufacturing process but are associated with products that have not been finished, is reported as direct materials inventory.

If factory overhead applied exceeds the actual costs, overhead is said to be underapplied.

List the accounts used in the cost flow for (a) a manufacturer and (b) a service provider.

Present entries to record the following summarized operations related to production for a company using a job order cost system:

The proper journal entry to record the purchase of $30,000 of raw materials on account would be:

Selected accounts with some debits and credits omitted are presented as follows: If the balance of Work in Process at August 31 is $220,000, what was the amount debited to Work in Process for direct materials in August?

The following are true regarding product costs except

The amount of time spent by an employee in the factory is usually recorded on:

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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