Exam 4: Job-Order Costing and Normal Cost Overhead Application

Diamond Design Company makes custom chairs for individual customers.On September 1, there was one job in process, Job 243, with a cost of $2,000.Jobs 244, 245, and 246 were started during the month of September.Data on costs added during the month are as follows: Overhead is applied to production at the rate of 60% of direct labor cost.Job 245 was completed on September 14 and the client was billed at cost plus 40%.All other jobs remained in process. Calculate the balance in Work-in-Process on September 30.

Match each item with the correct statement below. -An approach that assigns actual costs of direct materials, direct labor, and overhead to products

A source document by which direct labor costs are assigned to individual jobs is known as a _______________.

The King Corporation manufactures custom-made furniture.The following data pertains to Job X4A: Plantwide overhead rate is $22.50 per machine hour. - Job X4A consists of 500 units.One-half of Job X4A was sold for $10,000.What is the cost per unit for Job X4A?

In job-order costing, the journal entry for $1,700 of unpaid direct labor is: ​ ​ ​

The use of a departmental rate has the advantage of being simple and reduces data collection requirements.

Stutz, Inc.designs and builds basketball gymnasiums.Each gymnasium is custom-built to individual customers' specifications.Stutz uses job-order costing to keep track of its costs.In February it worked on three jobs.Data for these jobs are as follows: Overhead is applied to jobs at the rate of $25 per machine hour.By February 28, Job 178 is the only one unfinished.The balance of Finished Goods on February 1 is $94,000 (consisting of Job 177).Jobs 177 and 179 are sold during February.Stutz sells its product at cost plus 40%. - Calculate the balance of Finished Goods at February 28.

Match each item with the correct statement below. Answers may be used more than once. -Every time a new job is started this is prepared.

The difference between actual overhead and applied overhead is called an overhead variance.

The King Corporation manufactures custom-made furniture.The following data pertains to Job X4A: Plantwide overhead rate is $22.50 per machine hour. - One-half of Job X4A was sold for $10,000.What is the total amount of costs assigned to Job X4A?

The Kraig Corporation manufactures custom-made purses.The following data pertains to Job XY5: Plantwide overhead is applied using a plant-wide rate based on direct labor hours.Plantwide overhead was budgeted at $60,000 for the year and the direct labor hours were estimated to be 15,000.Job XY5 consists of 50 units.What is overhead cost assigned to Job XY5?

Applied overhead costs are charged to ________________.

Match each item with the correct statement below. Answers may be used more than once. -The job order number, or name, head this form.

Walter Company uses a job-order costing system to account for product costs.The following information pertains to the current year: Plantwide overhead rate is $18 per direct labor hour - What is the total amount debited to Finished Goods Inventory in the current year?

Which of the following is true about normal costing?

Departmental overheads cannot be added together to get plantwide overhead.

The journal entry for $17,000 materials purchased on account is: ​

Unit costs are calculated by:

The raw materials account is an inventory account located on the income statement.

If the overhead variance is immaterial, it is allocated among the ending balances of Work in Process, Finished Goods, and Cost of Goods Sold.