Question 1

The predetermined overhead allocation rate is used to apply overhead cost to products.

Accepted Answer

A) True 
 B)False  True

Question 2

A job order cost accounting system would be appropriate for a manufacturer of automobile tires.

Accepted Answer

A) True 
 B)False  False

Question 3

At the current year-end, Hardly Company found that its overhead was underapplied by $2,500, and this amount was not deemed to be a material amount.Based on this information, Hardly should:

Accepted Answer

A) Close the $2,500 to Cost of Goods Sold. 
B) Close the $2,500 to Finished Goods Inventory. 
C) Do nothing about the $2,500 since it is not material, and it is likely that overhead will be overapplied by the same amount next year. 
D) Carry the $2,500 to the income statement as Other Expense. 
E) Carry the $2,500 to the next period. 
A) Close the $2,500 to Cost of Goods Sold. 
B) Close the $2,500 to Finished Goods Inventory. 
C) Do nothing about the $2,500 since it is not material, and it is likely that overhead will be overapplied by the same amount next year. 
D) Carry the $2,500 to the income statement as Other Expense. 
E) Carry the $2,500 to the next period. A

Question 4

Match between columns
                        Premises: A separate record maintained for each job in a job order costing system; it shows direct materials, direct labor, and overhead for each job.
The amount by which overhead incurred in a period exceeds the overhead applied to jobs with the predetermined overhead allocation rate.
The production of products in response to special orders; also called customized production.
An accounting system for manufacturing activities based on the periodic inventory system.
A cost accounting system designed to determine the cost of producing each job or job lot.
The amount by which the overhead applied to jobs in a period with the predetermined overhead allocation rate exceeds the overhead incurred in a period.
A perpetual record that is updated each time units of raw material are both purchased and issued for use in production.
A source document that is used to record the number of hours an employee works and to determine the total labor cost for each pay period.
A source document that is used to report how much time an employee spent working on a job or on overhead activities and then to determine the amount of direct labor to charge to the job or the amount of indirect labor to charge to overhead.
A source document that production managers use to request materials for manufacturing and that is used to assign materials costs to specific jobs or to overhead.
The rate established prior to the beginning of a period that relates estimated overhead to an allocation factor such as estimated direct labor and is used to assign overhead cost to a job.

Accepted Answer

The Answer of Overapplied overhead and Job order manufacturing and is...

Question 5

When factory payroll is assigned to specific jobs, ______________________ is debited.

Accepted Answer

Goods in P

Question 6

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

Accepted Answer

The answer of When factory payroll for indirect labor is...

Question 7

In a job order cost accounting system, raw materials requisitioned as direct materials are debited to ______________________; indirect materials are debited to ___________________.

Accepted Answer

Goods in P

Question 8

Plumley Ad Agency contracted with a company to prepare an ad campaign.Plumley uses a job order costing system.Plumley estimates that the job will take 145 designer hours at $90 per hour and 85 staff hours at $45 per hour.Plumley uses two overhead rates in applying overhead to jobs: Designer-related at $100 per designer hour and staff-related at $50 per staff hour.Determine the total estimated cost for this job.

Accepted Answer

@#IMG-DLM&_TB6311_00

Question 9

A manufacturing company uses an overhead allocation rate based on direct labor cost.The company's Goods in Process Inventory account has a $15,000 debit balance after all posting is completed, and the cost sheet of the one job still in process shows direct material costs of $6,600 and direct labor costs of $3,000.What is the company's overhead application rate?

Accepted Answer

($15,000 -

Question 10

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.

Accepted Answer

A.$132,000/55,000 = $2.40 per

Question 11

If one unit of Product X used $2.50 of direct materials and $3.00 of direct labor, sold for $8.00, and was assigned overhead at the rate of 30% of direct labor costs, how much gross profit was realized from this sale?

Accepted Answer

A) $8.00 
B) $5.50 
C) $2.50 
D) $1.60 
E) $0.90 
A) $8.00 
B) $5.50 
C) $2.50 
D) $1.60 
E) $0.90

Question 12

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

Accepted Answer

A) True 
 B)False

Question 13

A company's overhead rate is 60% of direct labor cost.Using the following incomplete accounts, determine the cost of direct materials used:

Accepted Answer

A) $106,400 
B) $113,120 
C) $30,240 
D) $211,680 
E) $324,800 
A) $106,400 
B) $113,120 
C) $30,240 
D) $211,680 
E) $324,800

Question 14

Dell Builders manufactures each house to customer specifications.It most likely would use:

Accepted Answer

A) Capital process costing. 
B) A periodic inventory system. 
C) Unique costing. 
D) Job order costing. 
E) Activity-based costing. 
A) Capital process costing. 
B) A periodic inventory system. 
C) Unique costing. 
D) Job order costing. 
E) Activity-based costing.

Question 15

The Factory Overhead account will have a credit balance at the end of a period if overhead applied during the period is greater than the overhead incurred.

Accepted Answer

A) True 
 B)False

Question 16

Service firms, unlike manufacturing firms, should only use actual costs when determining a selling price for their services.

Accepted Answer

A) True 
 B)False

Question 17

Overhead is applied as a percent of direct labor costs.Estimated overhead and direct labor costs for the year were $112,500 and $125,000, respectively.During the year, actual overhead was $107,400 and actual direct labor cost was $120,000.The entry to close the over- or underapplied overhead at year-end, assuming an immaterial amount, would include:

Accepted Answer

A) A debit to Cost of Goods Sold for $600. 
B) A credit to Factory Overhead for $600. 
C) A credit to Finished Goods Inventory for $600. 
D) A debit to Goods in Process Inventory for $600. 
E) A credit to Cost of Goods Sold for $600. 
A) A debit to Cost of Goods Sold for $600. 
B) A credit to Factory Overhead for $600. 
C) A credit to Finished Goods Inventory for $600. 
D) A debit to Goods in Process Inventory for $600. 
E) A credit to Cost of Goods Sold for $600.

Question 18

A manufacturing firm that produces large numbers of standardized units would normally use a job order cost accounting system.

Accepted Answer

A) True 
 B)False

Question 19

The production of one unit of Product BBB used $17.50 of direct materials and $21 of direct labor.The unit sold for $56 and was assigned overhead at a rate of 30% of labor costs.What is the gross profit per unit on its sale?

Accepted Answer

@#IMG-DLM&_TB6311_00

Question 20

Overapplied or underapplied overhead should be removed from the Factory Overhead account at the end of each accounting period.

Accepted Answer

A) True 
 B)False

The predetermined overhead allocation rate is used to apply overhead cost to products.

A job order cost accounting system would be appropriate for a manufacturer of automobile tires.

At the current year-end, Hardly Company found that its overhead was underapplied by $2,500, and this amount was not deemed to be a material amount.Based on this information, Hardly should:

When factory payroll is assigned to specific jobs, ______________________ is debited.

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

In a job order cost accounting system, raw materials requisitioned as direct materials are debited to ____; indirect materials are debited to _.

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.

If one unit of Product X used $2.50 of direct materials and $3.00 of direct labor, sold for $8.00, and was assigned overhead at the rate of 30% of direct labor costs, how much gross profit was realized from this sale?

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

A company's overhead rate is 60% of direct labor cost.Using the following incomplete accounts, determine the cost of direct materials used:

Dell Builders manufactures each house to customer specifications.It most likely would use:

The Factory Overhead account will have a credit balance at the end of a period if overhead applied during the period is greater than the overhead incurred.

Service firms, unlike manufacturing firms, should only use actual costs when determining a selling price for their services.

A manufacturing firm that produces large numbers of standardized units would normally use a job order cost accounting system.

The production of one unit of Product BBB used $17.50 of direct materials and $21 of direct labor.The unit sold for $56 and was assigned overhead at a rate of 30% of labor costs.What is the gross profit per unit on its sale?

Overapplied or underapplied overhead should be removed from the Factory Overhead account at the end of each accounting period.

Managerial Accounting Concepts and Principles

Process Costing and Analysis

Activity-Based Costing and Analysis

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing and Performance Reporting

Master Budgets and Performance Planning

Flexible Budgets and Standard Costing

Performance Measurement and Responsibility Accounting

Relevant Costing for Managerial Decisions

Capital Budgeting and Investment Analysis

Reporting and Analyzing Cash Flows

Analyzing Financial Statements

Time Value of Money

Basic Accounting for Transactions

Accounting for Partnerships

Filters

Exam 2: Job Order Costing and Analysis

The predetermined overhead allocation rate is used to apply overhead cost to products.

A job order cost accounting system would be appropriate for a manufacturer of automobile tires.

At the current year-end, Hardly Company found that its overhead was underapplied by $2,500, and this amount was not deemed to be a material amount.Based on this information, Hardly should:

When factory payroll is assigned to specific jobs, ______________________ is debited.

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

In a job order cost accounting system, raw materials requisitioned as direct materials are debited to ______________________; indirect materials are debited to ___________________.

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.

If one unit of Product X used $2.50 of direct materials and $3.00 of direct labor, sold for $8.00, and was assigned overhead at the rate of 30% of direct labor costs, how much gross profit was realized from this sale?

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

A company's overhead rate is 60% of direct labor cost.Using the following incomplete accounts, determine the cost of direct materials used:

Dell Builders manufactures each house to customer specifications.It most likely would use:

The Factory Overhead account will have a credit balance at the end of a period if overhead applied during the period is greater than the overhead incurred.

Service firms, unlike manufacturing firms, should only use actual costs when determining a selling price for their services.

A manufacturing firm that produces large numbers of standardized units would normally use a job order cost accounting system.

The production of one unit of Product BBB used $17.50 of direct materials and $21 of direct labor.The unit sold for $56 and was assigned overhead at a rate of 30% of labor costs.What is the gross profit per unit on its sale?

Overapplied or underapplied overhead should be removed from the Factory Overhead account at the end of each accounting period.

Managerial Accounting Concepts and Principles

Process Costing and Analysis

Activity-Based Costing and Analysis

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing and Performance Reporting

Master Budgets and Performance Planning

Flexible Budgets and Standard Costing

Performance Measurement and Responsibility Accounting

Relevant Costing for Managerial Decisions

Capital Budgeting and Investment Analysis

Reporting and Analyzing Cash Flows

Analyzing Financial Statements

Time Value of Money

Basic Accounting for Transactions

Accounting for Partnerships

Filters

In a job order cost accounting system, raw materials requisitioned as direct materials are debited to ____; indirect materials are debited to _.