Exam 3: Job Costing, Process Costing, and Operations Costing

Which of the following costs is the most likely not allocated to a product in a job costing environment?

The key to allocating overhead costs is the determination of the ____.

Aronson & Associates LLP Aronson & Associates LLP, an accounting firm, assigns overhead to clients based on direct labor hours. The following information is available for the month of March: Refer to the Aronson & Associates LLP information above. The predetermined overhead rate for the month of March is:

What does it mean when overhead is over- or underapplied? What costs are affected by this and what are the two different ways to adjust for the over- or underapplied amount?

Companies that produce large numbers of standardized products within a particular batch would most likely use which type of costing?

Danville Manufacturing The Danville Manufacturing Company has two service departments and two production departments. The following data are available for 2011. The costs of service departments 1 and 2 are allocated on the basis of number of transactions and square feet occupied, respectively. Assuming that Danville Manufacturing Company allocates service department 1 costs first, the amount of service department 1 costs allocated to service department 2 under the step-down method would be:

What is the formula for calculating the predetermined overhead rate? How is the rate used in product costing?

Which of the following types of costs is not easily tracked or traced to a specific job or file in job-order costing?

With respect to process costing, what is the difference in how the weighted-average and first-in, first-out (FIFO) methods treat beginning work-in-process units?

Which of the following companies would be the most likely to adopt a process costing system?

List three reasons why service department costs should be allocated to production and explain the difference between the direct method and the step-down method of allocating service costs.

Newman Manufacturing underapplied its manufacturing overhead during 2011. Which of the following statements is true regarding the adjustment to clear out the underapplied overhead?

Bost Products Inc. Bost Products Inc. manufactures plastic products and uses process costing to account for the cost of products manufactured. All product costs are added evenly throughout the production process. The following information was available for the plastic department for the month of December: Refer to the Bost Products Inc. information above. If Bost uses the weighted-average method of computing equivalent units and assigning product costs, what is the cost of goods transferred out in December?

Companies that manufacture products such as custom-designed decks and pools would most likely use which type of costing?

Pioria Products assigns overhead to specific jobs based on machine hours. At the beginning of the current year, estimated overhead costs were $2,150,000 and estimated machine hours were 500,000. By the end of the year, actual overhead costs were calculated to be $2,000,000 and actual machine hours were 475,000. Required:

Aronson & Associates LLP Aronson & Associates LLP, an accounting firm, assigns overhead to clients based on direct labor hours. The following information is available for the month of March: Refer to the Aronson & Associates LLP information above. By how much was overhead over- or underapplied for the month of March?

Bost Products Inc. Bost Products Inc. manufactures plastic products and uses process costing to account for the cost of products manufactured. All product costs are added evenly throughout the production process. The following information was available for the plastic department for the month of December: Refer to the Bost Products Inc. information above. If Bost uses the first-in, first-out (FIFO) method of computing equivalent units and assigning product costs, what is the cost of the ending work-in-process inventory for December?

In job order costing, which of the following types of costs is usually the most difficult to trace to a product?

Benjamin Products uses job order costing and assigns overhead to specific jobs using direct labor hours. During the month of June, a total of 1,800 direct labor hours at a cost of $16 per hour were incurred for all jobs. Actual overhead costs for the month totaled $9,000. If a specific job required 36 direct labor hours of work, how much overhead should be applied to that job?

Samantha's Sundries Inc. assigns overhead to specific jobs based on machine hours. At the beginning of the current year, estimated overhead costs were $400,000 and estimated machine hours were 25,000. By the end of the year, actual overhead costs were calculated to be $375,000 and actual machine hours were 30,000. One of the jobs worked on during the year was Job #49 which used 30 machine hours. How much overhead was applied to Job #49?