Question 1

The basic source document for direct manufacturing labor is the ________.

Accepted Answer

A)  job-cost record 
B)  materials-requisition record 
C)  labor-time record 
D)  labor-requisition record 
A)  job-cost record 
B)  materials-requisition record 
C)  labor-time record 
D)  labor-requisition record C

Question 2

The Cost of Goods Sold account tracks job costs from the time jobs are started until they are completed.

Accepted Answer

A) True 
 B)False  False

Question 3

Francis and Hartley Law Office employs 12 full-time attorneys and 10 paraprofessionals. Direct and indirect costs are applied on a professional labor-hour basis that includes both attorney and paraprofessional hours. Following is information for 2018:
 
How much should the client be billed in an actual costing system if 220 professional labor-hours are used?

Accepted Answer

A)  $5,940 
B)  $7,744 
C)  $8,228 
D)  $7,040 
A)  $5,940 
B)  $7,744 
C)  $8,228 
D)  $7,040 D

Question 4

Management wants to prepare a profitability analysis of the company's customers and therefore the most accurate choice of disposing of underallocated or overallocated manufacturing overhead at year-end is the proration based on final balances of work-in-process, finished goods, and cost of goods sold.

Accepted Answer

A) True 
 B)False

Question 5

Purchases of materials are credited to materials control.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following increases (are debited to) the Work-in-Process Control account?

Accepted Answer

A)  actual plant insurance costs 
B)  customer services costs 
C)  marketing expenses 
D)  direct manufacturing labor costs 
A)  actual plant insurance costs 
B)  customer services costs 
C)  marketing expenses 
D)  direct manufacturing labor costs

Question 7

Elite Stationary employs 20 full-time employees and 10 trainees. Direct and indirect costs are applied on a professional labor-hour basis that includes both employee and trainee hours. Following is information for 2018:
 
How much should a client be billed in a normal costing system when 1,000 professional labor-hours are used?

Accepted Answer

A)  $215,000 
B)  $125,000 
C)  $130,000 
D)  $145,000 
A)  $215,000 
B)  $125,000 
C)  $130,000 
D)  $145,000

Question 8

ABC Manufacturing Inc. ends the month with two jobs still in progress. Job 5 has $10,000 of materials, $2,000 of direct labor and $8,000 of manufacturing overhead allocated. Job 6 has $30,000 of materials, $2,000 of direct labor and $12,000 of manufacturing overhead allocated. The cost of goods sold for the month was $40,000 and there was no finished goods in stock as the month ended. If the manufacturing overhead was underallocated by $10,000, which of the following choices would be the correct way to prorate it based on ending balances before proration?

Accepted Answer

A)  The entire $10,000 of underallocated manufacturing overhead should be allocated to cost of goods sold 
B)  $4,000 of the underallocated manufacturing overhead should be split between Job 6 and cost of goods sold 
C)  $2,000 of the overallocation should be allocated to Job 5 
D)  The entire $10,000 of underallocated manufacturing overhead should be added to operating expenses for the month 
A)  The entire $10,000 of underallocated manufacturing overhead should be allocated to cost of goods sold 
B)  $4,000 of the underallocated manufacturing overhead should be split between Job 6 and cost of goods sold 
C)  $2,000 of the overallocation should be allocated to Job 5 
D)  The entire $10,000 of underallocated manufacturing overhead should be added to operating expenses for the month

Question 9

Which of the following statements about normal costing is true?

Accepted Answer

A)  Direct costs and indirect costs are traced using an actual rate. 
B)  Direct costs and indirect costs are traced using budgeted rates. 
C)  Direct costs are traced using a budgeted rate, and indirect costs are allocated using an actual rate. 
D)  Direct costs are traced using an actual rate, and indirect costs are allocated using a budgeted rate. 
A)  Direct costs and indirect costs are traced using an actual rate. 
B)  Direct costs and indirect costs are traced using budgeted rates. 
C)  Direct costs are traced using a budgeted rate, and indirect costs are allocated using an actual rate. 
D)  Direct costs are traced using an actual rate, and indirect costs are allocated using a budgeted rate.

Question 10

For 2018, Rest-Well Bedding uses machine-hours as the only overhead cost-allocation base. The direct cost rate is $6.00 per unit. The selling price of the product is $21.00. The estimated manufacturing overhead costs are $275,000 and estimated 40,000 machine hours. The actual manufacturing overhead costs are $350,000 and actual machine hours are 50,000.
Using job costing, the 2018 actual indirect-cost rate is ________.

Accepted Answer

A)  $7.00 per machine-hour 
B)  $5.50 per machine-hour 
C)  $8.75 per machine-hour 
D)  $8.50 per machine-hour 
A)  $7.00 per machine-hour 
B)  $5.50 per machine-hour 
C)  $8.75 per machine-hour 
D)  $8.50 per machine-hour

Question 11

Indirect manufacturing costs are credited to Manufacturing Overhead Control.

Accepted Answer

A) True 
 B)False

Question 12

For a given job the direct costs associated with the job are ________.

Accepted Answer

A)  actual overhead that has been applied to the job 
B)  raw materials that can be traced to the job in an economically feasible way 
C)  All sunk costs that can be traced to the job in an economically feasible way 
D)  all fixed costs 
A)  actual overhead that has been applied to the job 
B)  raw materials that can be traced to the job in an economically feasible way 
C)  All sunk costs that can be traced to the job in an economically feasible way 
D)  all fixed costs

Question 13

Which of the following general ledger accounts will have a subsidiary ledger account?

Accepted Answer

A)  Cost of Goods Sold account 
B)  Work-in-Process Control account 
C)  Joe's Accounts Receivable subsidiary account 
D)  Operating Expenses account 
A)  Cost of Goods Sold account 
B)  Work-in-Process Control account 
C)  Joe's Accounts Receivable subsidiary account 
D)  Operating Expenses account

Question 14

X-Industries manufactures 3-D printers. For each unit, $3,400 of direct material is used and there is $2,600 of direct manufacturing labor at $16 per hour. Manufacturing overhead is applied at $20 per direct manufacturing labor hour. Calculate the profit earned on 46 units if each unit sells for $9,500.

Accepted Answer

A)  $65,320 
B)  $35,880 
C)  $11,500 
D)  $3,250 
A)  $65,320 
B)  $35,880 
C)  $11,500 
D)  $3,250

Question 15

Franklin Inc. manufactures pipes and applies manufacturing overhead costs to production at a budgeted indirect-cost rate of $15 per direct labor-hour. The following data are obtained from the accounting records for June 2018:
 
The amount of manufacturing overhead allocated to all jobs during June 2018 totals ________.

Accepted Answer

A)  $91,500 
B)  $60,000 
C)  $76,000 
D)  $60,500 
A)  $91,500 
B)  $60,000 
C)  $76,000 
D)  $60,500

Question 16

Job-costing is likely to be used by________.

Accepted Answer

A)  oil refining companies 
B)  advertising agencies 
C)  Mortgage payment processors 
D)  breakfast cereal producers 
A)  oil refining companies 
B)  advertising agencies 
C)  Mortgage payment processors 
D)  breakfast cereal producers

Question 17

In each period, job costing divides the total cost of producing an identical or similar product produced in batches by the total number of units produced to obtain a per-unit cost.

Accepted Answer

A) True 
 B)False

Question 18

Which account is debited if materials costing $100,000 are sold?

Accepted Answer

A)  Revenues account 
B)  Work-in-Process Control account 
C)  Materials Control account 
D)  Cost of Goods Sold account 
A)  Revenues account 
B)  Work-in-Process Control account 
C)  Materials Control account 
D)  Cost of Goods Sold account

Question 19

Process costing is used to assign manufacturing costs to unique batches of a product.

Accepted Answer

A) True 
 B)False

Question 20

A company has $25,000 of depreciation on plant assets and paid $12,000 for repairs also to plant assets. Which of the following journal entries would be required?

Accepted Answer

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

The basic source document for direct manufacturing labor is the ________.

The Cost of Goods Sold account tracks job costs from the time jobs are started until they are completed.

Purchases of materials are credited to materials control.

Which of the following increases (are debited to) the Work-in-Process Control account?

Which of the following statements about normal costing is true?

Indirect manufacturing costs are credited to Manufacturing Overhead Control.

For a given job the direct costs associated with the job are ________.

Which of the following general ledger accounts will have a subsidiary ledger account?

Job-costing is likely to be used by________.

In each period, job costing divides the total cost of producing an identical or similar product produced in batches by the total number of units produced to obtain a per-unit cost.

Which account is debited if materials costing $100,000 are sold?

Process costing is used to assign manufacturing costs to unique batches of a product.

A company has $25,000 of depreciation on plant assets and paid $12,000 for repairs also to plant assets. Which of the following journal entries would be required?

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Activity-Based Costing and Activity-Based Management

Master Budget and Responsibility Accounting

Flexible Budgets, Direct-Cost Variances, and Management Control

Flexible Budgets, Overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Pricing Decisions and Cost Management

Cost Allocation, Customer-Profitability Analysis, and Sales-Variance Analysis

Allocation of Support-Department Costs, Common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, Rework, and Scrap

Balanced Scorecard: Quality and Time

Inventory Management, Just-in-Time, and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, Transfer Pricing, and Multinational Considerations

Performance Measurement, Compensation, and Multinational Considerations

Filters

Exam 4: Job Costing

The basic source document for direct manufacturing labor is the ________.

The Cost of Goods Sold account tracks job costs from the time jobs are started until they are completed.

Purchases of materials are credited to materials control.

Which of the following increases (are debited to) the Work-in-Process Control account?

Which of the following statements about normal costing is true?

Indirect manufacturing costs are credited to Manufacturing Overhead Control.

For a given job the direct costs associated with the job are ________.

Which of the following general ledger accounts will have a subsidiary ledger account?

Job-costing is likely to be used by________.

In each period, job costing divides the total cost of producing an identical or similar product produced in batches by the total number of units produced to obtain a per-unit cost.

Which account is debited if materials costing $100,000 are sold?

Process costing is used to assign manufacturing costs to unique batches of a product.

A company has $25,000 of depreciation on plant assets and paid $12,000 for repairs also to plant assets. Which of the following journal entries would be required?

The Manager and Management Accounting

An Introduction to Cost Terms and Purposes

Cost-Volume-Profit Analysis

Activity-Based Costing and Activity-Based Management

Master Budget and Responsibility Accounting

Flexible Budgets, Direct-Cost Variances, and Management Control

Flexible Budgets, Overhead Cost Variances, and Management Control

Inventory Costing and Capacity Analysis

Determining How Costs Behave

Decision Making and Relevant Information

Strategy, Balanced Scorecard, and Strategic Profitability Analysis

Pricing Decisions and Cost Management

Cost Allocation, Customer-Profitability Analysis, and Sales-Variance Analysis

Allocation of Support-Department Costs, Common Costs, and Revenues

Cost Allocation: Joint Products and Byproducts

Process Costing

Spoilage, Rework, and Scrap

Balanced Scorecard: Quality and Time

Inventory Management, Just-in-Time, and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, Transfer Pricing, and Multinational Considerations

Performance Measurement, Compensation, and Multinational Considerations

Filters