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19 Chapter Job Order Cost Systems MULTIPLE CHOICE 1. Which of the following are the two main types of cost accounting systems for manufacturing operations? a. Process cost and general accounting systems b. Job order cost and process cost systems c. Job order and general accounting systems d. Process cost and replacement cost systems Register to View AnswerDIF: Easy OBJ: 19-01 NAT: AACSB Analytic | IMA-Cost Management 2. Which of the following would most likely use a job order costing system? a. A paper mill b. A swimming pool installer c. A company that manufactures chlorine for swimming pools d. An oil refinery Register to View AnswerDIF: Easy OBJ: 19-01 NAT: AACSB Analytic | IMA-Cost Management 3. Which of the following would be most likely to use process costing? a. A custom furniture manufacturer. b. An auto body repair shop. c. A law firm d. A lawn fertilizer manufacturer. Register to View AnswerDIF: Easy OBJ: 19-01 NAT: AACSB Analytic | IMA-Cost Management 4. Which of the following systems provides for a separate record of the cost of each particular quantity of product that passes through the factory? a. Job order cost system b. General cost system c. Replacement cost system d. Process cost system Register to View AnswerDIF: Easy OBJ: 19-01 NAT: AACSB Analytic | IMA-Cost Management 5. For which of the following businesses would the job order cost system be appropriate? a. Meat processor b. Automobile manufacturer c. Oil refinery d. Construction contractor DIF: Difficult OBJ: 19-01 Register to View Answer 23 24 3 Chapter 19/Job Order Cost Systems NAT: AACSB Analytic | IMA-Cost Management 6. For which of the following businesses would the process cost system be appropriate? a. Book retailer b. Dress designer c. Lumber mill d. Printing firm Register to View AnswerDIF: Difficult OBJ: 19-01 NAT: AACSB Analytic | IMA-Cost Management 7. Which of the following is not a characteristic of a job order costing system? a. It accumulates cost for each department within the factory. b. It provides a separate record for the cost of each quantity of product that passes through the factory. c. It is best suited for industries that manufactures custom goods. d. Uses only one work in process account. Register to View AnswerDIF: Easy OBJ: 19-01 NAT: AACSB Analytic | IMA-Cost Management 8. Which of the following products probably would be manufactured using a job order costing system? a. Number 2 pencils b. Computer monitors. c. Wedding invitations. d. Paper. Register to View AnswerDIF: Easy OBJ: 19-01 NAT: AACSB Analytic | IMA-Cost Management 9. Job order costing and process costing are a. pricing systems. b. cost accounting systems. c. cost flow systems. d. inventory tracking systems. Register to View AnswerDIF: Easy OBJ: 19-01 NAT: AACSB Analytic | IMA-Cost Management 10. Which of the following is not true about why a service firm will use the job order costing system? a. to help control costs b. to determine client billing c. to determine department costs within the firm d. to determine profit Register to View AnswerDIF: Moderate OBJ: 19-01 NAT: AACSB Analytic | IMA-Cost Management Chapter 19/Job Order Cost Systems 3 25 11. Which of the following costs are NOT included in finished goods inventory? a. Direct labor b. Factory overhead c. Company president's salary d. Direct materials Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 12. Which of the following is the correct flow of manufacturing costs? a. Raw materials, work in process, finished goods, cost of goods sold b. Raw materials, finished goods, cost of goods sold, work in process. c. Work in process, finished goods, raw materials, cost of goods sold d. Cost of goods sold, raw materials, work in process, finished goods. Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 13. Which of the following would record the labor costs to an individual job? a. Clock card b. In-and-out cards c. Time tickets d. Payroll register Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 14. The Collins Company forecasts that total overhead for the current year will be $12,000,000 and that total machine hours will be 200,000 hours. Year to date, the actual overhead is $8,000,000 and the actual machine hours are 100,000 hours. If the Collins Company uses a predetermined overhead rate based on machine hours for applying overhead, what is that overhead rate? a. $80 per machine hour b. $120 per machine hour c. $40 per machine hour d. $60 per machine hour Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 15. The Collins Company forecasts that total overhead for the current year will be $12,000,000 and that total machine hours will be 200,000 hours. Year to date, the actual overhead is $8,000,000 and the actual machine hours are 100,000 hours. If the Collins Company uses a predetermined overhead rate based on machine hours for applying overhead, as of this point in time (year to date) the overhead is over/under applied by? a. $2,000,000 over b. $2,000,000 under c. $4,000,000 over d. $4,000,000 under Register to View AnswerDIF: Difficult OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 26 3 Chapter 19/Job Order Cost Systems 16. At the end of the year, overhead applied was $319-02,000,000. Actual overhead was $34,200,000. Closing over/under applied overhead into cost of goods sold would cause net income to increase/decrease by? a. Increase by $800,000 b. Decrease by $800,000 c. Not effect net income. d. Decrease net income by $200,000 Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 17. Which of the following would most likely be a period cost? a. Depreciation on factory lunchroom furniture. b. Salary of telephone receptionist in the sales office. c. Salary of a security guard for the factory parking lot. d. Computer chips used by a computer manufacturer. Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 18. Which of the following would most likely be a product cost? a. Salary of VP of sales. b. Advertising for a particular product. c. Drill bits for a drill press used in the plant assembly area. d. Salary of the company receptionist. Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 19. The document authorizing the issuance of materials from the storeroom is the: a. materials requisition b. purchase requisition c. receiving report d. purchase order Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 20. The source of the data for debiting Work-in-Process for direct materials is the: a. purchase order b. purchase requisition c. materials requisition d. receiving report Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management Chapter 19/Job Order Cost Systems 3 27 21. In a job order cost accounting system, the entry to record the flow of direct materials into production is: a. debit Work in Process, credit Materials b. debit Materials, credit Work in Process c. debit Factory Overhead, credit Materials d. debit Work in Process, credit Supplies Register to View AnswerDIF: Difficult OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 22. A summary of the materials requisitions completed during a period serves as the basis for transferring the cost of the materials from the controlling account in the general ledger to the controlling accounts for: a. work in process and cost of goods sold b. work in process and factory overhead c. finished goods and cost of goods sold d. work in process and finished goods Register to View AnswerDIF: Difficult OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 23. In a job order cost accounting system, when goods that have been ordered are received, the receiving department personnel count, inspect the goods, and complete a: a. purchase order b. sales invoice c. receiving report d. purchase requisition Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 24. The amount of time spent by each employee and the labor cost incurred for each individual job or for factory overhead are recorded on: a. pay stubs. b. in-and-out cards. c. time cards. d. employees' earnings records. Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 25. The amount of time spent by an employee in the factory is usually recorded on: a. time cards b. job order cost sheets c. employees' earnings records d. statement of owners' equity Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 28 3 Chapter 19/Job Order Cost Systems 26. The basis for recording direct and indirect labor costs incurred is a summary of the period's: a. job order cost sheets b. time tickets c. employees' earnings records d. clock cards Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 27. The entry to record direct labor costs into production in a job order cost accounting system is: a. debit Factory Overhead, credit Work in Process b. debit Finished Goods, credit Wages Payable c. debit Work in Process, credit Wages Payable d. debit Factory Overhead, credit Wages Payable Register to View AnswerDIF: Difficult OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 28. At the end of July, the first month of the current fiscal year, the factory overhead account had a debit balance. Which of the following describes the nature of this balance and how it would be reported on the interim balance sheet? a. Overapplied, deferred credit b. Underapplied, deferred debit c. Underapplied, deferred credit d. Overapplied, deferred debit Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 29. At the end of the fiscal year, the balance in Factory Overhead is small. This balance would normally be: a. transferred to Work in Process b. transferred to Cost of Goods Sold c. transferred to Finished Goods d. allocated between Work in Process and Finished Goods Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 30. The details concerning the costs incurred on each job order are accumulated in a subsidiary ledger known as the: a. stock ledger b. materials ledger c. cost ledger d. creditors ledger Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management Chapter 19/Job Order Cost Systems 3 29 31. Each account in the cost ledger is called a: a. finished goods sheet b. stock record c. materials requisition d. job cost sheet Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 32. Selected accounts with some debits and credits omitted are presented as follows: Aug. 1 31 31 31 Balance Direct materials Direct labor Factory overhead Work in Process 275,000 Aug. 31 X 350,000 X Factory Overhead 90,000 Aug. 1 31 Goods finished 1,230,000 Aug. 1-31 Costs incurred Balance Applied (30% of direct labor cost) 15,000 X If the balance of Work in Process at August 31 is $200,000, what was the amount debited to Work in Process for direct materials in August? a. $700,000 b. $805,000 c. $300,000 d. $605,000 Register to View AnswerDIF: Difficult OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 30 3 Chapter 19/Job Order Cost Systems 33. Selected accounts with some debits and credits omitted are presented as follows: Aug. 1 31 31 31 Balance Direct materials Direct labor Factory overhead Work in Process 275,000 Aug. 31 X 350,000 X Factory Overhead 90,000 Aug. 1 31 Goods finished 1,230,000 Aug. 1-31 Costs incurred Balance Applied 15,000 X If the balance of Work in Process at August 31 is $200,000, what was the amount debited to Work in Process for factory overhead in August, assuming a factory overhead rate of 30%? a. $105,000 b. $120,000 c. $90,000 d. $70,000 Register to View AnswerDIF: Difficult OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 34. Selected accounts with some debits and credits omitted are presented as follows: Oct. 1 31 31 31 Oct. 1 31 Balance Direct materials Direct labor Factory overhead Balance Goods finished Work in Process 20,000 Oct. 31 96,700 201,000 X Finished Goods 52,000 360,000 Goods finished X If the balance of Work in Process at October 31 is $21,000, what was the amount of factory overhead applied in October? a. $63,300 b. $21,300 c. $42,300 d. $11,300 Register to View AnswerDIF: Difficult OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 35. Selected accounts with some debits and credits omitted are presented as follows: Apr. 1 30 30 30 Balance Direct materials Direct labor Factory overhead Work in Process 7,000 Apr. 30 78,400 195,000 136,500 Goods finished X Chapter 19/Job Order Cost Systems 3 31 Apr. 1 30 Balance Goods finished Finished Goods 42,000 387,000 What was the balance of Work in Process as of April 30? a. $8,100 b. $35,000 c. $29,900 d. $22,900 Register to View AnswerDIF: Difficult OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 36. If the amount of factory overhead cost incurred exceeds the amount applied, the factory overhead account will have a: a. debit balance and be underapplied b. debit balance and be overabsorbed c. credit balance and be overapplied d. debit balance and be overapplied Register to View AnswerDIF: Difficult OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 37. The recording of the factory labor incurred for general factory use would include a debit to: a. Factory Overhead b. Wages Payable c. Wages Expense d. Cost of Goods Sold Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 38. The recording of the application of factory overhead costs to jobs would include a credit to: a. Factory Overhead b. Wages Payable c. Work in Process d. Cost of Goods Sold Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 39. The recording of the jobs completed would include a debit to: a. Factory Overhead b. Finished Goods c. Work in Process d. Cost of Goods Sold Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 32 3 Chapter 19/Job Order Cost Systems 40. The recording of the jobs completed would include a credit to: a. Factory Overhead b. Finished Goods c. Work in Process d. Cost of Goods Sold Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 41. The recording of the jobs shipped and customers billed would include a debit to: a. Accounts Payable b. Cash c. Finished Goods d. Cost of Goods Sold Register to View AnswerDIF: Difficult OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 42. The recording of the jobs shipped and customers billed would include a credit to: a. Accounts Payable b. Cash c. Finished Goods d. Cost of Goods Sold Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 43. The finished goods account is the controlling account for the: a. cost ledger b. materials ledger c. work in process ledger d. stock ledger Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 44. The controlling account for the cost ledger is: a. Finished Goods b. Materials c. Work in Process d. Cost of Goods Sold Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 45. Putnam Manufacturers Inc. has estimated total factory overhead costs of $84,000 and 12,000 direct labor hours for the current fiscal year. If job number 117 incurred 1,500 direct labor hours, the work process in account will be debited and factory overhead will be credited for: a. $10,500 b. $0; WIP is credited c. $84,000 Chapter 19/Job Order Cost Systems 3 33 d. $1,500 Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 46. A widely used activity base for developing factory overhead rates in highly automated settings is: a. direct labor hours b. direct labor dollars c. direct materials d. machine hours Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 47. When job 711 was completed, direct materials totaled $4,000; direct labor, $4,600; and factory overhead, $2,400, respectively. Units produced totaled 1,000. Unit costs are: a. $11,000 b. $1,100 c. $110 d. $11 Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 48. The correct entry for each sale of a finished good on account is: a. debit Cost of Goods Sold, credit Finished Goods b. debit Cost of Goods Sold, credit Finished Goods, debit Accounts Receivable, credit Sales c. debit Sales Expense, credit Finished Goods, credit Cash, credit Accounts Receivable d. debit Work in Process, credit Finished Goods, debit Accounts Receivable, credit Sales Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 49. All of the following are examples of activity bases except: a. salaries of supervisors b. quality inspections of products c. number of machine setups d. raw materials storage Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 50. Materials purchased on account during the month amounted to $195,000. Materials requisitioned and placed in production totaled $168,000. From the following, select the entry to record the transaction on the day the materials were bought. a. Materials 168,000 Accounts Payable 168,000 b. Materials 195,000 Accounts Payable 195,000 c. Materials 195,000 Cash 195,000 34 3 Chapter 19/Job Order Cost Systems d. Accounts Payable Materials 195,000 195,000 Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 51. Materials purchased on account during the month amounted to $195,000. Materials requisitioned and placed in production totaled $168,000. From the following, select the entry to record the transaction on the day the materials were requisitioned by the production department. a. Materials 168,000 Work in Process 168,000 b. Work in Process 195,000 Materials 195,000 c. Work in Process 168,000 Materials 168,000 d. Work in Process 168,000 Cash 168,000 Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 52. During the period, labor costs incurred on account amounted to $225,000 including $195,000 for production orders and $30,000 for general factory use. In addition, factory overhead charged to production was $17,000. From the following, select the entry to record the direct labor costs. a. Work in Process 195,000 Wages Payable 195,000 b. Work in Process 225,000 Wages Payable 225,000 c. Work in Process 212,000 Wages Payable 212,000 d. Wages Payable 195,000 Work in Process 195,000 Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 53. During the period, labor costs incurred on account amounted to $225,000 including $195,000 for production orders and $30,000 for general factory use. In addition, factory overhead applied to production was $17,000. From the following, select the entry to record the actual factory overhead costs incurred. a. Accounts Payable 30,000 Factory Overhead 30,000 b. Factory Overhead 17,000 Accounts Payable 17,000 c. Work in Process 30,000 Factory Overhead 30,000 d. Factory Overhead 30,000 Wages Payable 30,000 Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management Chapter 19/Job Order Cost Systems 3 35 54. During the period, labor costs incurred on account amounted to $225,000 including $195,000 for production orders and $30,000 for general factory use. In addition, factory overhead applied to production was $17,000. From the following, select the entry to record the factory overhead applied to production. a. Work in Process 30,000 Factory Overhead 30,000 b. Factory Overhead 17,000 Work in Process 17,000 c. Work in Process 17,000 Factory Overhead 17,000 d. Factory Overhead 30,000 Accounts Payable 30,000 Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 55. The cost of production of completed and finished goods during the period amounted to $400,000, and the finished products shipped to customers had total production costs of $337,000. From the following, select the entry to record the transfer of costs from work in process to finished goods. a. Finished Goods 337,000 Work in Process 337,000 b. Finished Goods 400,000 Work in Process 400,000 c. Work in Process 400,000 Finished Goods 400,000 d. Work in Process 337,000 Finished Goods 337,000 Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 56. The cost of production of completed and finished goods during the period amounted to $400,000, and the finished products shipped to customers had total production costs of $337,000. From the following, select the entry to record the transfer of costs from finished goods to cost of goods sold. a. Finished Goods 400,000 Cost of Goods Sold 400,000 b. Finished Goods 337,000 Cost of Goods Sold 337,000 c. Cost of Goods Sold 337,000 Finished Goods 337,000 d. Cost of Goods Sold 400,000 Finished Goods 400,000 Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 57. Costs that are used in generating revenues during the current period are often referred to as: a. period costs b. conversion costs c. factory overhead costs 36 3 Chapter 19/Job Order Cost Systems d. product costs Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 58. Costs that are treated as assets until the product is sold are called: a. product costs b. period costs c. conversion costs d. selling expenses Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 59. The period costs of a textbook printer would include: a. wages of a press operator b. utility costs of factory c. advertising expenses d. paper costs Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 60. Which types of inventories does a manufacturing business report on the balance sheet? a. Finished goods inventory and work in process inventory b. Direct materials inventory and work in process inventory c. Direct materials inventory, work in process inventory, and finished goods inventory d. Direct materials inventory and finished goods inventory Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 61. For the manufacturing business, inventory which is in the process of being manufactured is referred to as: a. supplies inventory b. work in process inventory c. finished goods inventory d. direct materials inventory Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 62. The proper journal entry to record the purchase of $25,000 of raw materials on account would be: a. Jan 2 Raw Material Inventory 25,000 Accounts Receivable 25,000 b. Jan 2 Raw Material Inventory 25,000 Accounts Payable 25,000 c. Jan 2 Inventory 25,000 Accounts Receivable 25,000 d. Jan 2 Inventory 25,000 Cash 25,000 Chapter 19/Job Order Cost Systems 3 37 Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 63. Select the proper journal entry to record the movement of 1,250 units of part number 116B to work in process when each unit of PN 116B has a value of $1.50. a. Jan 15 Work in Process 1,875 Cash 1,875 b. Jan 15 Work in Process 1,250 Raw Material Inventory 1,250 c. Jan 15 Work in Process 1,875 Raw Material Inventory 1,875 d. Jan 15 Work in Process 1,250 Cash 1,250 Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 64. Which of the following represents the factory overhead applied to a product? a. Predetermined factory overhead rate times estimated activity base. b. Actual factory overhead rate times estimated activity base. c. Predetermined factory overhead rate times actual activity base. d. Actual factory overhead rate times actual activity base. Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 65. Which of the following is the correct formula to calculate the predetermined factory overhead rate? a. Estimate total factory overhead costs divided by estimated activity base. b. Actual total factory overhead costs divided by estimated activity base. c. Estimate total factory overhead costs divided by actual activity base. d. Actual total factory overhead costs divided by actual activity base. Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 66. The following budget data are available for Newest Company: Estimated direct labor hours Estimated direct dollars Estimated factory overhead costs 9,000 $60,000 $154,000 If factory overhead is to be applied based on direct labor hours, the predetermined overhead rate is a. $2.57 b. $.39 c. $6.67 d. $17.11 Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 38 3 Chapter 19/Job Order Cost Systems 67. A manufacturing company applies factory overhead based on direct labor hours. At the beginning of the year, it estimated that factory overhead costs would be $360,000 and direct labor hours would be 45,000. Actual factory overhead costs incurred were $377,200, and actual direct labor hours were 46,000. What is the amount of overapplied or underapplied manufacturing overhead at the end of the year? a. $17,000 overapplied. b. $17,000 underapplied. c. $9,200 overapplied. d. $9,200 underapplied. Register to View AnswerDIF: Difficult OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 68. A manufacturing company applies factory overhead based on direct labor hours. At the beginning of the year, it estimated that factory overhead costs would be $360,000 and direct labor hours would be 45,000. Actual manufacturing overhead costs incurred were $377,200, and actual direct labor hours were 46,000. What is the predetermined overhead rate per direct labor hour? a. $8.00 b. $8.20 c. $8.38 d. $7.83 Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 69. A manufacturing company applies factory overhead based on direct labor hours. At the beginning of the year, it estimated that factory overhead costs would be $360,000 and direct labor hours would be 45,000. Actual manufacturing overhead costs incurred were $377,200, and actual direct labor hours were 46,000. The entry to apply the factory overhead costs for the year would include a a. debit to factory overhead for $360,000. b. credit to factory overhead for $368,000. c. debit to factory overhead for $377,200. d. credit to factory overhead for $360,000. Register to View AnswerDIF: Difficult OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 70. Bar code scanners are now being used to track incoming materials and to electronically transmit this data. Scanners have replaced which of the following: a. receiving report b. materials requisition c. materials ledger d. job cost sheet Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management Chapter 19/Job Order Cost Systems 3 39 71. A separate account for each material is found in a a. general ledger b. materials ledger c. receiving report d. job cost sheet Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 72. The materials requisition is used to a. release materials from the storeroom to the factory b. release finished goods to the shipping department c. record the acquisition of materials from a vendor d. record and electronically transmit materials data in place of a receiving report Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 73. Period costs are a. found on the balance sheet. b. not involved in the production process. c. classified as direct labor, direct material, or factory overhead. d. found on the job order cost sheets. Register to View AnswerDIF: Easy OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 74. Generally, period costs are classified as either a. selling expenses or production expenses. b. administrative expense or production expenses. c. selling expenses or administrative expenses. d. general expenses or selling expenses. Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 75. The following are true regarding product costs except a. product costs are found on the balance sheet until they are sold. b. product costs consist of direct labor, direct materials, and factory overhead. c. product costs can be found in three accounts in the balance sheet. d. product costs include sales and administrative expenses. Register to View AnswerDIF: Moderate OBJ: 19-02 NAT: AACSB Analytic | IMA-Cost Management 40 3 Chapter 19/Job Order Cost Systems 76. Job cost sheets can provide information to managers for all but the following: a. cost impact of materials changes b. cost impact of continuous improvement in the manufacturing process c. cost impact of materials price or direct labor rate changes over time d. utilities, managerial salaries, and depreciation of computers in the corporate office Register to View AnswerDIF: Moderate OBJ: 19-03 NAT: AACSB Analytic | IMA-Cost Management 77. A difference in quantity of materials used on two comparable jobs may be caused by: a. inadequately trained employees b. poor quality materials c. employee carelessness d. all of the above Register to View AnswerDIF: Moderate OBJ: 19-03 NAT: AACSB Analytic | IMA-Cost Management 78. Which of the following would probably not be found in the accounting system of a service provider? a. Cost ledger b. Finished jobs ledger c. Deferred revenue account d. Job cost sheets Register to View AnswerDIF: Moderate OBJ: 19-04 NAT: AACSB Analytic | IMA-Cost Management 79. Which of the following entries would probably not be found on the books of a service provider? a. Debit Work in Process; credit Materials b. Debit Work in Process; credit Wages Payable c. Debit Work in Process; credit Overhead d. Debit Cost of Services; credit Work in Process Register to View AnswerDIF: Moderate OBJ: 19-04 NAT: AACSB Analytic | IMA-Cost Management 80. In a job order cost accounting system used by a service business, which of the following items would normally not be included as part of overhead? a. Materials b. Direct labor c. Rent d. Supplies Register to View AnswerDIF: Difficult OBJ: 19-04 NAT: AACSB Analytic | IMA-Cost Management Chapter 19/Job Order Cost Systems 3 41 81. The direct labor and overhead costs of providing services to clients are accumulated in: a. finished services expense b. work in process c. administrative salaries expense d. overhead Register to View AnswerDIF: Easy OBJ: 19-04 NAT: AACSB Analytic | IMA-Cost Management 82. When a job is completed in a service organization, the job costs are transferred to the a. work in process account. b. cost of services account. c. finished goods account. d. cost of goods sold account. Register to View AnswerDIF: Moderate OBJ: 19-04 NAT: AACSB Analytic | IMA-Cost Management ... View Full Document

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