Exam 2: Job-Order Costing: Calculating Unit Production Costs

The following partially completed T-accounts summarize transactions for Farwest Corporation during the year: The Cost of Goods Manufactured was:

Hacken Company has a job-order costing system.The company applies manufacturing overhead to jobs using a predetermined overhead rate based on direct labor cost.The information below has been taken from the cost records of Hacken Company for the past year: Required: a.Compute the cost of direct materials purchased during the year. b.Compute the predetermined overhead rate that was used during the past year. c.Compute the Cost of Goods Manufactured for the past year. d.Compute the unadjusted Cost of Goods Sold for the past year.

The following partially completed T-accounts summarize transactions for Farwest Corporation during the year: The manufacturing overhead applied was:

Emco Company uses direct labor cost as a basis for computing its predetermined overhead rate.In computing the predetermined overhead rate for last year,the company misclassified a portion of direct labor cost as indirect labor.The effect of this misclassification will be to:

The following accounts are from last year's books at Sharp Manufacturing: Sharp uses job-order costing and applies manufacturing overhead to jobs based on direct labor costs.What is the manufacturing overapplied or underapplied for the year?

During January,Shanker Corporation recorded the following: Required: Prepare T-accounts for Raw Materials,Work in Process,Finished Goods,and Manufacturing Overhead,and Cost of Goods Sold.Record the beginning balances and each of the transactions listed above.Finally,determine the ending balances.

The actual manufacturing overhead incurred at Fraze Corporation during November was $79,000,while the manufacturing overhead applied to Work in Process was $65,000.The Corporation's Cost of Goods Sold was $385,000 prior to closing out its Manufacturing Overhead account.The Corporation closes out its Manufacturing Overhead account to Cost of Goods Sold.Which of the following statements is true?

Baker Corporation applies manufacturing overhead on the basis of direct labor-hours.At the beginning of the most recent year,the company based its predetermined overhead rate on total estimated overhead of $210,600 and 6,000 estimated direct labor-hours.Actual manufacturing overhead for the year amounted to $209,000 and actual direct labor-hours were 5,980. The predetermined overhead rate for the year was closest to:

Sigel Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year.At the beginning of the most recently completed year,the company estimated the machine-hours for the upcoming year at 52,000 machine-hours.The estimated variable manufacturing overhead was $3.40 per machine-hour and the estimated total fixed manufacturing overhead was $624,520. Required: Compute the company's predetermined overhead rate.

Dillon Corporation applies manufacturing overhead to jobs using a predetermined overhead rate of 75% of direct labor cost.Any under or overapplied manufacturing overhead cost is closed out to Cost of Goods Sold at the end of the month.During May,the following transactions were recorded by the company: The amount of direct materials cost in the May 31 Work in Process inventory account was:

Job 231 was recently completed.The following data have been recorded on its job cost sheet: The company applies manufacturing overhead on the basis of machine-hours.The predetermined overhead rate is $11 per machine-hour. Required: Compute the unit product cost that would appear on the job cost sheet for this job.

In a job-order cost system,direct labor is assigned to a job using information from the employee time ticket.

Collins Corporation uses a predetermined overhead rate based on direct labor cost to apply manufacturing overhead to jobs.The following information applies to the Corporation for the current year: The manufacturing overhead cost for the current year will be:

When the predetermined overhead rate is based on direct labor-hours,the amount of overhead applied to a job is proportional to the estimated amount of direct labor-hours for the job.

Dapper Corporation had only one job in process on May 1.The job had been charged with $3,400 of direct materials,$4,640 of direct labor,and $9,200 of manufacturing overhead cost.The company assigns overhead cost to jobs using the predetermined overhead rate of $23.00 per direct labor-hour. During May,the following activity was recorded: Work in process inventory on May 30 contains $7,540 of direct labor cost.Raw materials consist solely of items that are classified as direct materials. The cost of goods manufactured for May was:

Bakerston Company is a manufacturing firm that uses job-order costing.The company's inventory balances were as follows at the beginning and end of the year: The company applies overhead to jobs using a predetermined overhead rate based on machine-hours.At the beginning of the year,the company estimated that it would work 33,000 machine-hours and incur $231,000 in manufacturing overhead cost.The following transactions were recorded for the year: • Raw materials were purchased,$315,000. • Raw materials were requisitioned for use in production,$307,000 ($281,000 direct and $26,000 indirect). • The following employee costs were incurred: direct labor,$377,000;indirect labor,$96,000;and administrative salaries,$172,000. • Selling costs,$147,000. • Factory utility costs,$10,000. • Depreciation for the year was $127,000 of which $120,000 is related to factory operations and $7,000 is related to selling,general,and administrative activities. • Manufacturing overhead was applied to jobs.The actual level of activity for the year was 34,000 machine-hours. • Sales for the year totaled $1,253,000. Required: a.Prepare a schedule of cost of goods manufactured. b.Was the overhead underapplied or overapplied? By how much? c.Prepare an income statement for the year.The company closes any underapplied or overapplied overhead to Cost of Goods Sold.

Sirmons Corporation bases its predetermined overhead rate on the estimated labor-hours for the upcoming year.At the beginning of the most recently completed year,the Corporation estimated the labor-hours for the upcoming year at 70,000 labor-hours.The estimated variable manufacturing overhead was $9.93 per labor-hour and the estimated total fixed manufacturing overhead was $1,649,200.The actual labor-hours for the year turned out to be 74,000 labor-hours.The predetermined overhead rate for the recently completed year was closest to:

At the beginning of December,Sneeden Corporation had $32,000 of raw materials on hand.During the month,the Corporation purchased an additional $71,000 of raw materials.During December,$75,000 of raw materials were requisitioned from the storeroom for use in production.The credits entered in the Raw Materials account during the month of December total:

Baker Corporation applies manufacturing overhead on the basis of direct labor-hours.At the beginning of the most recent year,the company based its predetermined overhead rate on total estimated overhead of $210,600 and 6,000 estimated direct labor-hours.Actual manufacturing overhead for the year amounted to $209,000 and actual direct labor-hours were 5,980. The overhead for the year was:

The sum of all amounts transferred from the Work in Process account to the Finished Goods account represents the Cost of Goods Sold for the period.