Section I: Do on SCANTRON sheet.
ONLY SCANTRON circles graded (15 x 1=15 points).
1. Maher, Inc., applies manufacturing overhead at the rate of $60 per machine hour.
Budgeted machine hours for the current period were anticipated to be 80,000; however,
a lengthy strike resulted in actual machine hours being worked of only 65,000.
Budgeted and actual manufacturing overhead figures for the year were $4,800,000 and
On the basis of this information, the company's year-end
A) overapplied by $280,000.
B) underapplied by $280,000.
C) overapplied by $620,000.
D) underapplied by $620,000.
E) underapplied by $900,000.
2. Under a traditional costing system, which of the following costs would likely be
classified as indirect with respect to the various products manufactured?
A) Plant maintenance.
B) Factory supplies.
D) Machinery depreciation.
E) All of the above would be considered indirect costs.
3. Conversion costs are:
A) direct material, direct labor, and manufacturing overhead.
B) direct material and direct labor.
C) direct labor and manufacturing overhead.
D) prime costs.
E) period costs.
4. When underapplied or overapplied manufacturing overhead is pro-rated, amounts can be
assigned to which of the following accounts?
A) Raw-Material Inventory, Manufacturing Overhead, and Direct Labor
B) Work-in-process inventory, Raw Material Inventory, and Cost of Goods Sold
C) Raw-Material Inventory, Finished Goods Inventory, and Cost of Goods Sold
D) Raw-Material Inventory, Work-in Process Inventory, and Finished Goods Inventory
E) None of the above.