Exam 19: Job Order Cost Accounting

Bard Manufacturing uses a job order cost accounting system. During one month Bard purchased $198,000 of raw materials on credit; issued materials to production of $195,000 of which $30,000 were indirect. Bard incurred a factory payroll of $150,000, paid in cash, of which $40,000 is classified as indirect labor. Bard uses a predetermined overhead application rate of 150% of direct labor cost. The journal entry to record payment of the factory payroll is:

Describe the use of the Factory Payroll account in a job order cost accounting system.

A time ticket is a source document used by an employee to record the number of hours worked on a particular job during the work day.

A company that uses a job order cost accounting system would make the following entry to record the flow of direct materials into production:

A job cost sheet includes:

The predetermined overhead allocation rate for Millay Manufacturing is based on estimated direct labor costs of $350,000 and estimated factory overhead of $770,000. Actual costs incurred were: a. Calculate the predetermined overhead rate and calculate the overhead applied during the year. b. Determine the amount of over- or underapplied overhead and prepare the journal entry to eliminate the over- or underapplied overhead assuming that it is not material in amount.

When factory payroll for indirect labor is assigned, __________________ is debited.

M.A.E. charged the following amounts of overhead to jobs during the year: $20,000 to jobs still in process, $60,000 to jobs completed but not sold, and $120,000 to jobs finished and sold. At year-end, M.A.E. Company's Factory Overhead account has a credit balance of $5,000, which is not a material amount. What entry should M.A.E. make at year-end?

The direct materials section of a job cost sheet shows the materials costs assigned to a job, but the direct labor section only shows the total hours of labor allocated to the job.

A system of accounting for production operations that uses a periodic inventory system is called a:

Any material amount of under- or overapplied factory overhead must always be closed to Cost of Goods Sold at the end of an accounting period.

A company charged the following amounts of overhead to jobs during the current year: $12,000 to jobs still in process, $42,000 to jobs completed but not sold, and $66,000 to jobs finished and sold. At year-end, the company's Factory Overhead account has a credit balance of $9,000, which is not a material amount. What entry (if any) should the company make at year-end related to this overhead balance?

Selected information from the budget of the Khalid Corp. at the beginning of the year follows: Calculate the predetermined overhead allocation rate if the company uses the following as a basis: (a) Direct labor hours. (b) Direct labor cost. (c) Machine hours.

The collection of job cost sheets for all jobs in process makes up the subsidiary ledger controlled by the _____________________ inventory.

The overhead cost applied to a job during a period is recorded with a credit to Factory Overhead and a debit to:

A company's file of job cost sheets for finished but unsold jobs equals the balance in the Finished Goods Inventory account.

In comparison to a general accounting system for a manufacturing company, a cost accounting system places an emphasis on:

The amount by which the overhead applied to jobs during a period exceeds the overhead incurred during the period is known as:

When materials are used as indirect materials, their cost is debited to the Factory Overhead account.

The production activities for a customized product represent a(n):