Question 1

Using the job order cost system, service organizations are able to bill customers on a weekly or monthly basis, even when the job has not been completed.

Accepted Answer

A) True 
 B)False

Question 2

The recording of the jobs completed would include a credit 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 3

Discuss how job order cost information is used in decision making. What are some possible reasons that actual cost of materials would exceed expected costs for a job?

Accepted Answer

Since a job order cost system provides p

Question 4

The Cavy 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 40,000 hours. The machine hours for the month of April for all of the jobs was 4,780. If the actual factory overhead totaled $141,800, determine the over or under applied amount for the month.

Accepted Answer

$141,800 -

Question 5

Which of the following are the two main types of cost accounting systems for manufacturing operations?

Accepted Answer

A)  Process cost and general accounting systems 
B)  Job order cost and process cost systems 
C)  Job order and general accounting systems 
D)  Process cost and replacement cost systems 
A)  Process cost and general accounting systems 
B)  Job order cost and process cost systems 
C)  Job order and general accounting systems 
D)  Process cost and replacement cost systems

Question 6

If the amount of factory overhead cost incurred exceeds the amount applied, the factory overhead account will have a:

Accepted Answer

A)  debit balance and be underapplied 
B)  credit balance and be underapplied 
C)  credit balance and be overapplied 
D)  debit balance and be overapplied 
A)  debit balance and be underapplied 
B)  credit balance and be underapplied 
C)  credit balance and be overapplied 
D)  debit balance and be overapplied

Question 7

On November 14th the Milling Department has accepted Job 111407A for 1,000 pounds of Cereal Mix. The bill of materials (BOM) for the Cereal Mix is:
   Manufacturing overhead is applied at $5.75 per pound completed, and $75.75 of materials are returned to Raw Materials Inventory. The recipe produced 1,025 pounds of cereal mix.

Accepted Answer

The answer of On November 14th the Milling Department has...

Question 8

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. Determine the over or under applied amount for the year.

Accepted Answer

A)  $17,500 overapplied 
B)  $17,500 underapplied 
C)  $118,250 overapplied 
D)  $118,250 underapplied 
A)  $17,500 overapplied 
B)  $17,500 underapplied 
C)  $118,250 overapplied 
D)  $118,250 underapplied

Question 9

Flagler Company allocates overhead based on machine hours. They estimated overhead costs for the year to be $420,000. Estimated machine hours were 50,000. Actual hours and costs for the year were 46,000 machine hours and $380,000 of overhead.
Required:
a. Calculate the overhead application rate for the year.
b. What is the amount of applied overhead for the year?
c. What is the amount of under or overapplied overhead for the year? Indicate whether it is over- or underapplied.

Accepted Answer

a. $420,000/50,000 = $8.40/mac

Question 10

The controlling account for the cost ledger is:

Accepted Answer

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

Question 11

For which of the following businesses would the process cost system be appropriate?

Accepted Answer

A)  Book retailer 
B)  Dress designer 
C)  Lumber mill 
D)  Printing firm 
A)  Book retailer 
B)  Dress designer 
C)  Lumber mill 
D)  Printing firm

Question 12

Selected accounts with a credit amount omitted are presented as follows:  
 
What was the balance of Work in Process as of April 30?

Accepted Answer

A)  $8,100 
B)  $35,000 
C)  $29,900 
D)  $22,900 
A)  $8,100 
B)  $35,000 
C)  $29,900 
D)  $22,900

Question 13

Period costs are

Accepted Answer

A)  found on the balance sheet. 
B)  not involved in the production process. 
C)  classified as direct labor, direct material, or factory overhead. 
D)  found on the job order cost sheets. 
A)  found on the balance sheet. 
B)  not involved in the production process. 
C)  classified as direct labor, direct material, or factory overhead. 
D)  found on the job order cost sheets.

Question 14

A job order cost system would be appropriate for a crude oil refining business.

Accepted Answer

A) True 
 B)False

Question 15

Prepare the journal entry for materials and labor, based on the following:

Accepted Answer

The answer of Prepare the journal entry for materials and...

Question 16

Costs that are treated as assets until the product is sold are called:

Accepted Answer

A)  product costs 
B)  period costs 
C)  conversion costs 
D)  selling expenses 
A)  product costs 
B)  period costs 
C)  conversion costs 
D)  selling expenses

Question 17

Put the following in the order of the flow of manufacturing costs for a company
a. Closing under/over applied factory overhead to cost of goods sold
b. Materials purchased
c. Factory labor used and factory overhead incurred in production
d. Completed jobs moved to finished goods
e. Factory overhead applied to jobs according to the predetermined overhead rate
f. Materials requisitioned to jobs
g. Selling of finished product
h. Preparation of financial statements to determine gross profit

Accepted Answer

b. Materials purchased
f. Materials requ

Question 18

The current year's advertising costs are normally considered period costs.

Accepted Answer

A) True 
 B)False

Question 19

The period costs of a textbook publisher would include:

Accepted Answer

A)  wages of a press operator 
B)  factory utility costs 
C)  advertising expenses 
D)  paper costs 
A)  wages of a press operator 
B)  factory utility costs 
C)  advertising expenses 
D)  paper costs

Question 20

During the period, labor costs incurred on account amounted to $275,000 including $200,000 for production orders and $75,000 for general factory use. In addition, factory overhead charged to production was $32,000. From the following, select the entry to record the direct labor costs.

Accepted Answer

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

Exam 17: Job Order Costing

Using the job order cost system, service organizations are able to bill customers on a weekly or monthly basis, even when the job has not been completed.

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

Discuss how job order cost information is used in decision making. What are some possible reasons that actual cost of materials would exceed expected costs for a job?

Which of the following are the two main types of cost accounting systems for manufacturing operations?

If the amount of factory overhead cost incurred exceeds the amount applied, the factory overhead account will have a:

The controlling account for the cost ledger is:

For which of the following businesses would the process cost system be appropriate?

Selected accounts with a credit amount omitted are presented as follows: What was the balance of Work in Process as of April 30?

Period costs are

A job order cost system would be appropriate for a crude oil refining business.

Prepare the journal entry for materials and labor, based on the following:

Costs that are treated as assets until the product is sold are called:

The current year's advertising costs are normally considered period costs.

The period costs of a textbook publisher would include:

During the period, labor costs incurred on account amounted to $275,000 including $200,000 for production orders and $75,000 for general factory use. In addition, factory overhead charged to production was $32,000. From the following, select the entry to record the direct labor costs.

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

Filters