Exam 3: Product Costing and Cost Accumulation in a Batch Production Environment

If the amount of effort and attention to products varies substantially throughout a company's various manufacturing operations, the company might consider the use of:

Two-stage cost allocation uses a first stage to assign all product costs to production departments and then a second stage to apply different cost drivers to improve efficiency.

Boxer Industries worked on four jobs during its first year of operation: nos. 401, 402, 403, and 404. A review of job no. 403's cost record revealed direct material charges of $40,000 and total manufacturing costs of $50,000. If Boxer applies overhead at 150% of direct labor cost, the overhead applied to job no. 403 must have been:

The term "normal costing" refers to the use of job-costing systems.

A custom-home builder would likely utilize:

Throughput time includes the time required for all of these except:

The final step in recognizing the completion of production requires a company to:

At the Bayshore Advertising Agency, partner and staff compensation cost is a key driver of agency overhead. In light of this fact, which of the following is the correct expression to determine the amount of overhead applied to a particular client job?

Layman, Inc., has just completed job nos. 78 and 79, which were similar in terms of complexity, production processes, and units manufactured. Job no. 78 was manufactured by Joe Bingham who earns $14 per hour, whereas job no. 79 was completed by Susan Fortner who earns $20 per hour. If Joe and Susan are equally efficient, would the company be better off using direct labor cost or direct labor hours as the cost driver in its predetermined oerhead rate? Briefly explain.

A production order for a job authorizes the release of material to production.

Which of the following manufacturers would most likely use job-order costing?

Morgan Manufacturing recently sold goods that cost $35,000 for $45,000 cash. The journal entries to record this transaction would include:

The term "normal costing" refers to the use of:

Describe the types of manufacturing environments that would best be suited for (1) job-order costing and (2) process costing. Include two examples of manufacturers that would likely use job-cost systems.

The assignment of direct labor cost to individual jobs is based on: