Question 1

A job order cost system accumulates costs for each of the departments or processes within the factory.

Accepted Answer

A) True 
 B)False

Question 2

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 3

The current year's advertising costs are normally considered as product costs.

Accepted Answer

A) True 
 B)False

Question 4

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 5

For an automotive repair shop, the wages of mechanics would be classified as direct labor cost.

Accepted Answer

A) True 
 B)False

Question 6

Non-manufacturing costs are generally classified into two categories: selling and administrative.

Accepted Answer

A) True 
 B)False

Question 7

The recording of the jobs completed would decrease:

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 8

Which of the following manufacturing costs is an indirect cost of producing a product?

Accepted Answer

A)  Oil lubricants used for factory machinery 
B)  Commissions for sales personnel 
C)  Hourly wages of an assembly worker 
D)  Memory chips for a microcomputer manufacturer 
A)  Oil lubricants used for factory machinery 
B)  Commissions for sales personnel 
C)  Hourly wages of an assembly worker 
D)  Memory chips for a microcomputer manufacturer

Question 9

The Harold Company forecasts that total overhead for the current year will be $12,000,000 and total machine hours will be 200,000 hours. However, the actual overhead is $4,000,000 and the actual machine hours are 100,000 hours. If the company uses a predetermined overhead rate based on machine hours for applying overhead, the overhead will be:

Accepted Answer

A)  overapplied by $2,000,000. 
B)  underapplied by $2,000,000. 
C)  overapplied by $4,000,000. 
D)  underapplied by $4,000,000. 
A)  overapplied by $2,000,000. 
B)  underapplied by $2,000,000. 
C)  overapplied by $4,000,000. 
D)  underapplied by $4,000,000.

Question 10

As product costs are incurred in the manufacturing process, they are accounted for as assets and reported on the balance sheet as inventory.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is an example of a factory overhead cost?

Accepted Answer

A)  Repair and maintenance cost on the administrative building 
B)  Factory heating and lighting cost 
C)  Insurance premiums on salespersons' automobiles 
D)  President's salary 
A)  Repair and maintenance cost on the administrative building 
B)  Factory heating and lighting cost 
C)  Insurance premiums on salespersons' automobiles 
D)  President's salary

Question 12

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 cost 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 cost and general accounting systems 
D)  Process cost and replacement cost systems

Question 13

Direct labor cost is an example of a product cost.

Accepted Answer

A) True 
 B)False

Question 14

Increase in the Work-in-Process account occur when:

Accepted Answer

A)  materials are received into the storeroom. 
B)  factory overhead costs are incurred. 
C)  direct labor is recorded from the time sheets. 
D)  materials are ordered. 
A)  materials are received into the storeroom. 
B)  factory overhead costs are incurred. 
C)  direct labor is recorded from the time sheets. 
D)  materials are ordered.

Question 15

Inventories of finished products are reported as current assets on a manufacturer's balance sheet.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following would not be classified as direct materials for an auto manufacturer?

Accepted Answer

A)  Steel 
B)  Upholstery fabric 
C)  Cost of the engine of the car. 
D)  Material used for door panels 
A)  Steel 
B)  Upholstery fabric 
C)  Cost of the engine of the car. 
D)  Material used for door panels

Question 17

The Anderson Company forecasts that total overhead for the current year will be $15,000,000 and total machine hours will be 200,000 hours. However, the actual overhead is $8,000,000 and the actual machine hours are 100,000 hours. If the company uses a predetermined overhead rate based on machine hours for applying overhead, what is predetermined overhead rate?

Accepted Answer

A)  $80 per machine hour 
B)  $150 per machine hour 
C)  $75 per machine hour 
D)  $40 per machine hour 
A)  $80 per machine hour 
B)  $150 per machine hour 
C)  $75 per machine hour 
D)  $40 per machine hour

Question 18

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

Accepted Answer

A) True 
 B)False

Question 19

KCT Printing Company uses a job order cost system.
 (a) Incicate the source of the data for increasing Work in Process for each of the following:
(1)Direct materials requisitioned

(2)Direct labor used

(b) Inclicate the source of the data for decreasing Work in Processs for jobs completed.
(c) Present a list of the three controlling accounts used in the general ledger to record the inventories and, in each case, inclicate the related subsicliary ledger.

Accepted Answer

The answer of KCT Printing Company uses a job order...

Question 20

The finished goods account is a controlling account for the subsidiary:

Accepted Answer

A)  sales ledger. 
B)  materials ledger. 
C)  work-in-process ledger. 
D)  stock ledger. 
A)  sales ledger. 
B)  materials ledger. 
C)  work-in-process ledger. 
D)  stock ledger.

A job order cost system accumulates costs for each of the departments or processes within the factory.

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

The current year's advertising costs are normally considered as product costs.

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

For an automotive repair shop, the wages of mechanics would be classified as direct labor cost.

Non-manufacturing costs are generally classified into two categories: selling and administrative.

The recording of the jobs completed would decrease:

Which of the following manufacturing costs is an indirect cost of producing a product?

As product costs are incurred in the manufacturing process, they are accounted for as assets and reported on the balance sheet as inventory.

Which of the following is an example of a factory overhead cost?

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

Direct labor cost is an example of a product cost.

Increase in the Work-in-Process account occur when:

Inventories of finished products are reported as current assets on a manufacturer's balance sheet.

Which of the following would not be classified as direct materials for an auto manufacturer?

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

The finished goods account is a controlling account for the subsidiary:

The Role of Accounting in Business

Basic Accounting Concepts

Accrual Accounting Concepts

Accounting for Merchandising Businesses

Sarbanes-Oxley, Internal Control, and Cash

Receivables and Inventories

Fixed Assets and Intangible Assets

Liabilities and Stockholders Equity

Financial Statement Analysis

Cost Behavior and Cost-Volume-Profit Analysis

Differential Analysis and Product Pricing

Budgeting and Standard Cost Systems

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

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Exam 10: Accounting Systems for Manufacturing Businesses

A job order cost system accumulates costs for each of the departments or processes within the factory.

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

The current year's advertising costs are normally considered as product costs.

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

For an automotive repair shop, the wages of mechanics would be classified as direct labor cost.

Non-manufacturing costs are generally classified into two categories: selling and administrative.

The recording of the jobs completed would decrease:

Which of the following manufacturing costs is an indirect cost of producing a product?

As product costs are incurred in the manufacturing process, they are accounted for as assets and reported on the balance sheet as inventory.

Which of the following is an example of a factory overhead cost?

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

Direct labor cost is an example of a product cost.

Increase in the Work-in-Process account occur when:

Inventories of finished products are reported as current assets on a manufacturer's balance sheet.

Which of the following would not be classified as direct materials for an auto manufacturer?

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

The finished goods account is a controlling account for the subsidiary:

The Role of Accounting in Business

Basic Accounting Concepts

Accrual Accounting Concepts

Accounting for Merchandising Businesses

Sarbanes-Oxley, Internal Control, and Cash

Receivables and Inventories

Fixed Assets and Intangible Assets

Liabilities and Stockholders Equity

Financial Statement Analysis

Cost Behavior and Cost-Volume-Profit Analysis

Differential Analysis and Product Pricing

Budgeting and Standard Cost Systems

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

Filters