Exam 19: Cost Concepts and Cost Allocation

The following information was taken from the cost records of the Krameer Company: Estimated overhead \ 180,000 Actual overhead \ 178,000 Estimated direct labor hours 24,000 Actual direct labor hours 25,000 If overhead is applied based on direct labor hours, the company's overapplied or underapplied overhead was

Which of the following is not an example of indirect materials?

The job order cost card reflects the product cost per unit.

Which of the following documents initiates the purchasing of materials?

All manufacturing costs that are assigned to completed (but unsold) products should be classified as

Depreciation on factory equipment is a value-adding cost.

In a manufacturing environment, costs of materials initially flow

A single predetermined overhead rate is most appropriately used to assign overhead costs when a company produces a diverse set of products.

Use the information below for the year ended December 31, 20xx, to prepare the statement of cost of goods manufactured. Inventories Beginning Ending Materials inventory \ 41,000 \ 51,000 Work in process inventory 62,000 78,000 Direct materials purchased 258,000 Total direct labor costs 372,000 Total indirect labor costs 67,000 Utilities 41,000 Depreciation 54,000 Small tools 5,000 Factory insurance 3,000 Factory supervision 66,000 Miscellaneous overhead costs 11,000

Product costs for a manufacturing company consist of direct materials, direct labor, and overhead.

Both product costs and period costs could appear on the income statement.

Use the information below for the year ended December 31, 20xx, to prepare the statement of cost of goods manufactured.

The cost of goods manufactured decreases which of the following accounts?

Which of the following is not a product cost?

Sugar is an indirect cost in the manufacture of candy.

When a company calculates its product unit cost using estimated costs, it is using which cost measurement method?

Which of the following results in a predetermined overhead rate?

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.

Some period costs can be found in inventory accounts on the balance sheet.

As the management accountant for Bynami Enterprises, Inc., you have been asked to prepare a statement of cost of goods manufactured at the end of the first quarter. Account balances at that time were as follows: Materials inventory, January 1, 20xx \ 510,500 Work in process inventory, January 1, 20xx 697,300 Finished goods inventory, January 1, 20xx 701,200 Direct materials purchased during the quarter 1,105,400 Direct labor costs 154,800 Depreciation expense, plant and equipment 16,200 Plant supervisors' salaries 50,600 Insurance expense, plant and equipment 1,100 Utilities expense, plant 4,000 Indirect labor costs 16,800 Manufacturing supplies expense 3,400 Small tools expense 1,500 March 31 inventories were as follows: materials, $540,200; work in process, $795,400; and finished goods, $604,100. Prepare the statement of cost of goods manufactured for the first quarter of 20xx.