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gnbexam03_11e - GNB 11/e Practice Exam Chapter 3 Print...

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GNB 11/e Practice Exam – Chapter 3 Print these pages. Answer each of the following questions, explaining your answers or showing your work, as appropriate, and then compare your solutions to those provided at the end of the practice exam. 1. When is job-order costing typically used by a company? How does it differ from process costing? What documents are typically used in a job-order system? 2. Benes Company has the following estimated costs for next year: Direct materials $120,000 Direct labor 440,000 Sales commissions 600,000 Salary of production supervisor 280,000 Indirect materials 40,000 Advertising expense 88,000 Rent on factory equipment 128,000 The company estimates that 80,000 direct labor and 64,000 machine hours will be worked during the year. If overhead is applied on the basis of machine hours, what will be the overhead rate per hour?
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3. Koch Company uses a predetermined overhead rate based on direct labor hours to apply manufacturing overhead to jobs. At the beginning of the year, the company estimated manufacturing overhead would be $400,000 and direct labor hours would be 40,000. The actual figures for the year were $430,000 for manufacturing overhead and 42,000 direct labor hours. What will the amount of over- or underapplied overhead be for the year? 4. McDermott Company’s predetermined overhead rate is based on direct labor hours. At the beginning of the current year, the company estimated that its manufacturing overhead would total $440,000 during the year. During the year, the company incurred $400,000 in actual
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