Question 1

Disadvantages of actual costing include

Accepted Answer

A)  actual cost systems cannot provide accurate unit cost information on a timely basis. 
B)  actual cost systems produce unit costs that fluctuate from period to period. 
C)  estimates must be used when calculating the actual overhead rate. 
D)  both a and b. 
A)  actual cost systems cannot provide accurate unit cost information on a timely basis. 
B)  actual cost systems produce unit costs that fluctuate from period to period. 
C)  estimates must be used when calculating the actual overhead rate. 
D)  both a and b. D

Question 2

In job-order costing, departmental overhead rates and activity-based costing affect only the application of overhead.

Accepted Answer

A) True 
 B)False  True

Question 3

A production process may yield a tangible product or a service and their unique characteristics determine the best approach for developing a cost management system.

Accepted Answer

A) True 
 B)False  True

Question 4

Homogeneous products refer to

Accepted Answer

A)  products similar in nature. 
B)  the nonphysical nature of services and opposed to products. 
C)  great variation in the nature products. 
D)  products that can be inventoried. 
A)  products similar in nature. 
B)  the nonphysical nature of services and opposed to products. 
C)  great variation in the nature products. 
D)  products that can be inventoried.

Question 5

Figure 5 - 2 The Cameron Corporation manufactures custom-made purses. The following data pertains to Job XY5:
  Factory overhead is applied using a plant-wide rate based on direct labor hours. Factory overhead was budgeted at $80,000 for the year and the direct labor hours were estimated to be 20,000. Job XY5 consists of 50 units.
Refer to Figure 5-2. What is overhead cost assigned to Job XY5?

Accepted Answer

A)  $200 
B)  $400 
C)  $750 
D)  $1,500 
A)  $200 
B)  $400 
C)  $750 
D)  $1,500

Question 6

When a job is completed the total costs are transferred to a __________ inventory file.

Accepted Answer

The answer of When a job is completed the total...

Question 7

Inseparability refers to the

Accepted Answer

A)  nonphysical nature of services as opposed to products. 
B)  fact that production and consumption are inseparable for services. 
C)  greater chances for variation in the performance of services than in the production of products. 
D)  fact that services cannot be inventoried but must be consumed when performed. 
A)  nonphysical nature of services as opposed to products. 
B)  fact that production and consumption are inseparable for services. 
C)  greater chances for variation in the performance of services than in the production of products. 
D)  fact that services cannot be inventoried but must be consumed when performed.

Question 8

Figure 5-9 The Omega Company manufactures customized motors on a job-order basis. Job 492 is an order for 100 units. It requires the following:
  After inspection, 2 units required rework which required 8 additional direct labor hours and $60 of materials.
Refer to Figure 5-9. If the rework is considered abnormal spoilage, what is the cost of job 492?

Accepted Answer

A)  $5,500 
B)  $5,760 
C)  $3,140 
D)  $5,640 
A)  $5,500 
B)  $5,760 
C)  $3,140 
D)  $5,640

Question 9

The entry that captures the flow of material from the storeroom to work-in-process is called
the __________ inventory account.
or

Accepted Answer

work-in-pr

Question 10

A job-order costing process would be applicable for to airplane manufacturer.

Accepted Answer

A) True 
 B)False

Question 11

Heterogeneity refers to the

Accepted Answer

A)  nonphysical nature of services as opposed to products. 
B)  fact that production and consumption are inseparable for services. 
C)  greater chances for variation in the performance of services than in the production of products. 
D)  fact that services cannot be inventoried but must be consumed when performed. 
A)  nonphysical nature of services as opposed to products. 
B)  fact that production and consumption are inseparable for services. 
C)  greater chances for variation in the performance of services than in the production of products. 
D)  fact that services cannot be inventoried but must be consumed when performed.

Question 12

Figure 5 - 8 Lamour Corporation is a job order costing company that uses activity-based costing to apply overhead to jobs. The following overhead activities were budgeted for the year.
  The following information about the jobs was given for April.
  By April 30, Jobs 102 and 103 were completed and sold. The remaining jobs were still in process.
Refer to Figure 5-8. What is the cost of goods manufactured?

Accepted Answer

A)  $ 144,400 
B)  $ 215,670 
C)  $ 178,340 
D)  $ 249,610 
A)  $ 144,400 
B)  $ 215,670 
C)  $ 178,340 
D)  $ 249,610

Question 13

Figure 5 - 2 The Cameron Corporation manufactures custom-made purses. The following data pertains to Job XY5:
  Factory overhead is applied using a plant-wide rate based on direct labor hours. Factory overhead was budgeted at $80,000 for the year and the direct labor hours were estimated to be 20,000. Job XY5 consists of 50 units.
Refer to Figure 5-2. What is the materials cost per unit for Job XY5?

Accepted Answer

A)  $267 
B)  $80 
C)  $40 
D)  $4 
A)  $267 
B)  $80 
C)  $40 
D)  $4

Question 14

Unit costs are critical for

Accepted Answer

A)  valuing inventory. 
B)  determining net income. 
C)  decisions to enter a new product line. 
D)  all of the above. 
A)  valuing inventory. 
B)  determining net income. 
C)  decisions to enter a new product line. 
D)  all of the above.

Question 15

Determining the dollar amounts of direct materials, direct labor, and overhead used in production involves __________ .

Accepted Answer

The answer of Determining the dollar amounts of direct materials,...

Question 16

What are the source documents used in a job-order costing system? How do the source documents relate to the job cost sheet? How do these documents inform work in process?

Accepted Answer

The materials requisition form and job t

Question 17

Which of the following items is a basic costing system record in a job-order costing system?

Accepted Answer

A)  materials requisition form 
B)  job-order cost sheet 
C)  job time ticket 
D)  all of the above 
A)  materials requisition form 
B)  job-order cost sheet 
C)  job time ticket 
D)  all of the above

Question 18

Figure 5 - 6 In the Monroe Company, the following Job cards were totaled at the end of the month:
Job 243 $5,750
Job 244 $4,980
Job 245 $3,675
Job 246 $4,250
Job 247 $5,100
Job 248 $3,800
Jobs 243 and 244 were in Finished Goods Inventory at the beginning of the month. Jobs 245 and 246 were in Work-in-process at the beginning of the month. Jobs 247 and 248 were started during the month. At the end of the month, Jobs 243 and 247 were sent to customers; jobs 245, 247, and 248 were completed and sent to finished goods.
Refer to Figure 5-6. What is the cost of goods manufactured for the month?

Accepted Answer

A)  $10,730 
B)  $10,850 
C)  $12,575 
D)  none of these 
A)  $10,730 
B)  $10,850 
C)  $12,575 
D)  none of these

Question 19

Which of the following firms would make extensive use of service costing?

Accepted Answer

A)  Law firm 
B)  furniture manufacturer 
C)  auto dealer 
D)  auto manufacturer 
A)  Law firm 
B)  furniture manufacturer 
C)  auto dealer 
D)  auto manufacturer

Question 20

Figure 5-7 The following information is available pertaining to the Production Division of Clarkson Enterprises:
  Refer to Figure 5-7. Based on departmental overhead rates, what is the cost of Job 4X5? Departmental overhead rates for the Assembly Department are based on direct labor hours, while departmental overhead rates for the Finishing Department are based on machine hours.

Accepted Answer

A)  $31,250 
B)  $8,750 
C)  $2,000 
D)  $1,250 
A)  $31,250 
B)  $8,750 
C)  $2,000 
D)  $1,250

Disadvantages of actual costing include

In job-order costing, departmental overhead rates and activity-based costing affect only the application of overhead.

A production process may yield a tangible product or a service and their unique characteristics determine the best approach for developing a cost management system.

Homogeneous products refer to

When a job is completed the total costs are transferred to a __________ inventory file.

Inseparability refers to the

The entry that captures the flow of material from the storeroom to work-in-process is called the __________ inventory account. or

A job-order costing process would be applicable for to airplane manufacturer.

Heterogeneity refers to the

Unit costs are critical for

Determining the dollar amounts of direct materials, direct labor, and overhead used in production involves __________ .

What are the source documents used in a job-order costing system? How do the source documents relate to the job cost sheet? How do these documents inform work in process?

Which of the following items is a basic costing system record in a job-order costing system?

Which of the following firms would make extensive use of service costing?

Introduction to Cost Management

Basic Cost Management Concepts

Cost Behavior

Activity-Based Costing

Process Costing

Allocating Costs of Support Departments and Joint Products

Budgeting for Planning and Control Key

Standard Costing: a Functional-Based Control Approach

Decentralization: Responsibility Accounting, Performance Evaluation, and Transfer Pricing

Strategic Cost Management

Activity-Based Management

The Balanced Scorecard: Strategic-Based Control

Quality and Environmental Cost Management

Lean Accounting and Productivity Measurement

Cost-Volume-Profit Analysis

Activity Resource Usage Model and Tactical Decision Making

Pricing and Profitability Analysis

Capital Investment

Inventory Management: Economic Order Quantity, Jit, and the Theory of Constraints

Filters

Exam 5: Product and Service Costing: Job-Order System

Disadvantages of actual costing include

In job-order costing, departmental overhead rates and activity-based costing affect only the application of overhead.

A production process may yield a tangible product or a service and their unique characteristics determine the best approach for developing a cost management system.

Homogeneous products refer to

When a job is completed the total costs are transferred to a __________ inventory file.

Inseparability refers to the

The entry that captures the flow of material from the storeroom to work-in-process is called the __________ inventory account. or

A job-order costing process would be applicable for to airplane manufacturer.

Heterogeneity refers to the

Unit costs are critical for

Determining the dollar amounts of direct materials, direct labor, and overhead used in production involves __________ .

What are the source documents used in a job-order costing system? How do the source documents relate to the job cost sheet? How do these documents inform work in process?

Which of the following items is a basic costing system record in a job-order costing system?

Which of the following firms would make extensive use of service costing?

Introduction to Cost Management

Basic Cost Management Concepts

Cost Behavior

Activity-Based Costing

Process Costing

Allocating Costs of Support Departments and Joint Products

Budgeting for Planning and Control Key

Standard Costing: a Functional-Based Control Approach

Decentralization: Responsibility Accounting, Performance Evaluation, and Transfer Pricing

Strategic Cost Management

Activity-Based Management

The Balanced Scorecard: Strategic-Based Control

Quality and Environmental Cost Management

Lean Accounting and Productivity Measurement

Cost-Volume-Profit Analysis

Activity Resource Usage Model and Tactical Decision Making

Pricing and Profitability Analysis

Capital Investment

Inventory Management: Economic Order Quantity, Jit, and the Theory of Constraints

Filters