Exam 4: Systems Design: Process Costing

In a job-order costing system,the journal entry to record the application of overhead cost to jobs would include:

Sharp Company's records show that overhead was overapplied by $10,000 last year.This overapplied overhead was closed out to the Cost of Goods Sold account at the end of the year.In trying to determine why overhead was overapplied by such a large amount,the company has discovered that $6,000 of depreciation on factory equipment was charged to administrative expense in error.Given the above information,which of the following statements is true?

The indirect labour cost is?

Hussain Shop uses a job-order costing system.Overhead is applied to jobs based on direct labour hours.The source document that would give the number of direct labour hours worked on Job 256 is the:

The Watts Company uses predetermined overhead rates to apply manufacturing overhead to jobs.The predetermined overhead rate is based on labour cost in Dept.A and on machine hours in Dept.B.At the beginning of the year,the company made the following estimates: What predetermined overhead rates would be used in Dept A and Dept B,respectively?

The Collins Company uses a job-order cost system and applies manufacturing overhead cost to jobs on the basis of the cost of materials used in production.At the beginning of the most recent year,the following estimates were made as a basis for computing the predetermined overhead rate for the year: manufacturing overhead cost,$200,000;direct materials cost,$160,000.The following transactions took place during the year (all purchases and services were acquired on account): a.Raw materials purchased,$86,000. b.Raw materials requisitioned for use in production (all direct materials),$98,000. c.Utility costs incurred in the factory,$15,000. d.Salaries and wages incurred as follows:

The Samuelson Company uses a job-order costing system.The following data were recorded for June: Overhead is charged to production at 70% of the direct materials cost.Jobs 475,477,and 478 have been delivered to the customer. Samuelson's Work in Process inventory balance on June 30 was:

Using the following information: Assuming underapplied overhead is considered material,using the preferred method,what would be the adjustment to Cost of Goods Sold to close the underapplied overhead?

Beaver Company used a predetermined overhead rate last year of $2 per direct labour hour,based on an estimate of 25,000 direct labour hours to be worked during the year.Actual costs and activity during the year were: The underapplied or overapplied overhead last year was:

Which of the following statements is not always true?

Freeman Company uses a predetermined overhead rate based on direct labour hours to apply manufacturing overhead to jobs.At the beginning of the year,the company estimated manufacturing overhead would be $150,000 and direct labour hours would be 10,000.The actual figures for the year were $186,000 for manufacturing overhead and 12,000 direct labour hours.The cost records for the year will show:

Normally a job cost sheet is not prepared for a job until after the job has been completed.

The amount of direct materials cost in the March 31 work in process inventory account was:

Using the following information: The predetermined overhead rate for applying manufacturing overhead would be:

What was the balance in Work-in-Process inventory on December 31,2014?

In job-order costing,all of the following statements are correct with respect to labour time and cost except:

Absorption costing includes both fixed and variable costs when computing the cost of a product.

In a job-order costing system,the use of indirect materials would usually be recorded as a debit to:

Which of the following companies would be most likely to use a job-order costing system rather than a process costing system?

Lucas Co.has a job-order costing system.For the month of April,the following debits (credits)appeared in the Work in Process account: Lucas applies overhead at a predetermined rate of 90% of direct labour cost.Job No.100,the only job still in process at the end of April,has been charged with manufacturing overhead of $4,500.The amount of direct materials charged to Job No.100 was: