Question 1

A ______________________ is a separate record maintained for each job.

Accepted Answer

The answer of A ______________________ is a separate record maintained...

Question 2

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.

Question 3

How does job order cost accounting affect the company Astor and Black?

Accepted Answer

Astor and Black sell custom-made men's s

Question 4

A manufacturing company uses a job order cost accounting system.Overhead is applied using direct labor hours as an allocation base.Total costs for a particular job were $5,720.Of this amount $2,600 was direct labor and $1,040 was direct material.The company pays $26 per hour of direct labor and $2 per pound of direct materials.What is this company's overhead rate?

Accepted Answer

A)  $26.00 per direct labor hour. 
B)  $20.80 per direct labor hour. 
C)  $ 4.00 per direct labor hour. 
D)  $80.00 per direct labor hour. 
E)  $2,080 per direct labor hour. 
A)  $26.00 per direct labor hour. 
B)  $20.80 per direct labor hour. 
C)  $ 4.00 per direct labor hour. 
D)  $80.00 per direct labor hour. 
E)  $2,080 per direct labor hour.

Question 5

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

Question 6

A perpetual record of a raw materials item that records data on the quantity and cost of units purchased,units issued for use in production,and units that remain in the raw materials inventory is called a(n):

Accepted Answer

A)  Materials ledger card. 
B)  Materials requisition. 
C)  Purchase order. 
D)  Materials voucher. 
E)  Purchase ledger. 
A)  Materials ledger card. 
B)  Materials requisition. 
C)  Purchase order. 
D)  Materials voucher. 
E)  Purchase ledger.

Question 7

M.A.E.charged the following amounts of overhead to jobs during the year: $20,000 to jobs still in process; $60,000 to jobs completed but not sold; and $120,000 to jobs finished and sold.At year-end,M.A.E.Company's Factory Overhead account has a credit balance of $5,000,which is not a material amount.What entry should M.A.E.make at year-end?
A.$\text { No entry is needed.}$

B.  
$\begin{array}{llr}
  \text {Factory Overhead  } &5,000\
 \text { Cost of Goods Sold } &&5,000  \
\end{array}$

C.  
$\begin{array}{llr}
  \text {  Cost of Goods Sold} &5,000\
 \text {Factory Overhead   } &&5,000\
\end{array}$

D. 
$\begin{array}{llr}
  \text { Factory Overhead } &5,000\
 \text {Goods in Process Inventory  } &&5,000\
\end{array}$

E. 
$\begin{array}{llr}
  \text { Factory Overhead  } &5,000\
 \text {  Finished Goods} &&5,000\
\end{array}$

Accepted Answer

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

Question 8

A manufacturing company that uses a cost accounting system normally has only two inventory accounts: Finished Goods Inventory and Goods in Process Inventory.

Accepted Answer

A) True 
 B)False

Question 9

A time ticket is a source document used by an employee to record the number of hours worked on a particular job during the work day.

Accepted Answer

A) True 
 B)False

Question 10

There are two basic types of cost accounting systems: job order costing and periodic costing.

Accepted Answer

A) True 
 B)False

Question 11

The following data relates to the Density Company's first operating period.Calculate cost of goods sold for each product.
 $\begin{array}{cccccc}
&&&&&\text {Overhead }\
&&&&&\text {Rate}\
&\text {Cost/Unit}&&&\text {Units}&\text {(Percent}\
&\text { Direct}&\text { Direct }&&\text {Ending }&\text {of Direct }\
\text { Product }&\text {Materials }&\text {Labor}&\text { Produced}&\text { Inventory}&\text { Labor Cost }\
\text { A } & \$ 10 & \$ 12 & 215 & 115 & 60 \% \
\text { B } & 8 & 15 & 330 & 180 & 40 \% \
\text { C } & 14 & 10 & 250 & 200 & 80 \%
\end{array}$

Accepted Answer

* Overhead applied:
A: $12.00 x 60% = $7

Question 12

In a job order cost accounting system,the total balances of all of the job cost sheets for unfinished jobs equal the balance in the Goods in Process Inventory account.

Accepted Answer

A) True 
 B)False

Question 13

RC Corp.uses a job order cost accounting system.During the month of April,the following events occurred:
A. Purchased raw materials on credit, $32,000.
B. Raw materials requisitioned: $25,800 as direct materials (Job 1:$4,200, Job 2: $7,500, Job 3: $3,600 and Job 4: $10,500) and $10,500 indirect materials.
C. Paid factory payroll for the month totaling $37,700 which includes $8,200 indirect labor.
D. Assigned the factory payroll to jobs and overhead. (Job 1:$7,000, Job 2: $9,800, Job 3: $3,000 and Job 4: $9,700)
E. Overhead was assigned at a rate of 50% of direct labor cost.
Determine the total cost of each job.

Accepted Answer

Job 1: $4,200 + 7,000 + (7,000

Question 14

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 15

A company uses a job order cost accounting system and applies overhead on the basis of direct labor cost.At the end of a recent period,the company's Goods in Process Inventory account appeared as follows:
 $$\begin{array}{c}
\text { Goods in Process }\
\begin{array} { l l l c r r r } 
\hline \text { Date } &  { \text { Explanation } } & \text { PR } & \text { Debit } & \text { Credit } & \text { Balance } \
\hline \text { Mar. } & 17 \text { Job No. } 5 \text { completed } & G - 8 & & 90,900 & ( 17,100 ) \
\text { Apr. } & 13 \text { Job No. } 6 \text { completed } & G - 10 && 131,400 & ( 148,500 ) \
\text { July } & 20 \text { Job No. } 7 \text { completed } & G - 12 & & 73,800 & ( 222,300 ) \
\text { Oct. } & 11 \text { Job No. } 8 \text { completed } & G - 15 && 168,300 & ( 390,600 ) \
\text { Dec. } & 31 \text { Direct Materials } & G - 20 & 235,800 && ( 154,800 ) \
& 31 \text { Direct Labor } & G - 20 & 117,000 && ( 37,800 ) \
& 31 \text { Factory Overhead } & G - 20 & 187,200 && 149,400
\end{array}
\end{array}$$ 
Write in the blanks for the following: 
A. The total cost of the direct materials, direct labor, and factory overhead applied in the December 31 goods in process inventory is $_______________________.
B . The company's overhead application rate is __________________%
C . Job No. 6 had $26,550 of direct labor cost. Therefore, the job must have had $________ of direct materials cost.
D. Job No. 8 had $73,998 of direct materials cost. Therefore, the job must have had $________ of factory overhead cost.

Accepted Answer

A.$149,400 (ending balance of account)
B

Question 16

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 17

A material amount of overapplied or underapplied overhead should be disposed of by allocating it to:

Accepted Answer

A)  Cost of goods sold and finished goods. 
B)  Finished goods and goods in process. 
C)  Goods in process, finished goods, and cost of goods sold. 
D)  Goods in process. 
E)  Raw materials, goods in process, and finished goods. 
A)  Cost of goods sold and finished goods. 
B)  Finished goods and goods in process. 
C)  Goods in process, finished goods, and cost of goods sold. 
D)  Goods in process. 
E)  Raw materials, goods in process, and finished goods.

Question 18

A company charged the following amounts of overhead to jobs during the current year: $12,000 to jobs still in process,$42,000 to jobs completed but not sold,and $66,000 to jobs finished and sold.At year-end,the company's Factory Overhead account has a credit balance of $9,000,which is not a material amount.What entry (if any)should the company make at year-end related to this overhead balance?

Accepted Answer

None

Question 19

Using the following accounts and an overhead rate of 90% of direct labor cost,determine the amount of applied overhead.

Accepted Answer

A)  $79,200 
B)  $167,200 
C)  $34,320 
D)  $88,000 
E)  $35,376 
A)  $79,200 
B)  $167,200 
C)  $34,320 
D)  $88,000 
E)  $35,376

Question 20

Job order manufacturing systems would be appropriate for companies that produce custom homes,specialized equipment,and special computer systems.

Accepted Answer

A) True 
 B)False

Exam 15: Job Order Costing and Analysis

A ______________________ is a separate record maintained for each job.

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:

How does job order cost accounting affect the company Astor and Black?

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

A perpetual record of a raw materials item that records data on the quantity and cost of units purchased,units issued for use in production,and units that remain in the raw materials inventory is called a(n):

A manufacturing company that uses a cost accounting system normally has only two inventory accounts: Finished Goods Inventory and Goods in Process Inventory.

A time ticket is a source document used by an employee to record the number of hours worked on a particular job during the work day.

There are two basic types of cost accounting systems: job order costing and periodic costing.

In a job order cost accounting system,the total balances of all of the job cost sheets for unfinished jobs equal the balance in the Goods in Process Inventory account.

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 material amount of overapplied or underapplied overhead should be disposed of by allocating it to:

Using the following accounts and an overhead rate of 90% of direct labor cost,determine the amount of applied overhead.

Job order manufacturing systems would be appropriate for companies that produce custom homes,specialized equipment,and special computer systems.

Introducing Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts and Preparing Financial Statements

Accounting for Merchandising Operations

Inventories and Cost of Sales

Cash and Internal Controls

Accounts and Notes Receivable

Long-Term Assets

Current Liabilities

Long-Term Liabilities

Corporate Reporting and Analysis

Reporting Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Process Costing

Activity-Based Costing and Analysis

Cost-Volume-Profit Analysis

Variable Costing and Performance Reporting

Master Budgets and Performance Planning

Flexible Budgets and Standard Costs

Decentralization and Performance Measurement

Relevant Costing for Managerial Decisions

Capital Budgeting and Investment Analysis

Accounting With Special Journals

Time Value of Money

Investments and International Operations

Accounting for Partnerships

Filters