Exam 16: Cost Concepts and Cost Allocation

Complete the following chart by placing an "X" under the applicable column heading.Classify each cost as a fixed cost or variable cost and as either a direct or indirect product cost or a period cost.

The numbers of vendors,products,and engineering change orders are examples of

Which of the following represents normal cost measurement?

Taperno Manufacturing Company has made the following cost estimates for next year: Direct labor \ 90,000 Direct materials 72,000 Indirect labor 19,200 Indirect materials 8,400 Depreciation - factory building 8,200 Depreciation - factory machinery 4,200 Depreciation -affice equigment 500 Factory utilities 4,900 Factory property taxes 3,100 Selling exgenses 25,000 Miscellanedus dverhead costs 5,600 General and administrative expenses 19,000 The company applies overhead based on direct labor hours.The estimated direct labor hours for next year are 16,000 hours. Compute the overhead application rate that will be used to apply overhead during the next year.

Inventoriable cost is a synonym of period cost.

Total manufacturing costs include all direct materials used as well as all direct labor costs and overhead costs incurred for a period.

Compute the overhead rate per shipping request for the Shipping Department if the estimated overhead costs are $18,290 and the number of estimated shipping requests is 3,100.

The amount computed for cost of goods manufactured should be the same as the amount transferred from the materials inventory,direct labor,and overhead accounts into the Work in Process Inventory account.

In the traditional manufacturing environment,overhead costs cannot be traced directly to products.

The four most common activity bases used for overhead cost allocation purposes are direct labor dollars,units of output,water pressure,and machine hours.

Which of the following is not a product cost?

(Direct Materials + Direct Labor + Overhead)/ Total Number of Units Produced = Product Unit Cost.

If Company G uses an overhead rate of $3.50 per direct labor dollar,and 63,500 hours of direct labor at $9.00 per hour are actually incurred,$222,250 of overhead costs are allocated for that period.

The two types of cost behavior are value-adding and nonvalue-adding.

The income statement for a manufacturing company usually contains a detailed computation of the

Identify the document needed to support each of the following activities in a manufacturing organization: __________ a. Placing an order for direct materials with a supplier __________ b. Recording direct labor time at the beginning and end of each work shift __________ c. Issuing direct materials into production __________ d. Recording the costs of a specific job requiring direct materials, direct labor, and overhead __________ e. Billing a customer for a completed order __________ __________ f. Receiving direct materials at the shipping dock

The costs of labor for maintenance and inspections are examples of direct labor.

Lubrication used for machines is an example of a direct material.

Total manufacturing costs increase which of the following accounts?

From Jolier's year-end income statement,you observe that the finished goods inventory has doubled during the year.This would indicate that during the year Jolier