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ch7 Student: ___________________________________________________________________________ 1. A job is a product or service that can be easily and conveniently distinguished from other products/services. True False 2. Job cost sheets are used in accounting systems as a subsidiary ledger for the Work-in-Process account. True False 3. Job shops have three types of inventory accounts: Finished Goods, Work-in-Process, and Direct Materials. True False 4. The cost in the ending Finished Goods inventory account consists of the direct materials, direct labor, and manufacturing overhead of all jobs still in process at the end of the period. True False 5. Accounting for direct materials and direct labor is easier than accounting for manufacturing overhead costs. True False 6. Indirect material and indirect labor are two examples of manufacturing overhead costs. True False 7. The journal entry to record actual manufacturing overhead for indirect material debits Manufacturing Overhead (Control) and credits Accounts Payable. True False 8. The journal entry to record actual manufacturing overhead for indirect labor debits Manufacturing Overhead (Control) and credits Work-in-Process inventory. True False 9. The periodic allocation of manufacturing overhead costs to job cost sheets is based on an event, not a transaction. True False 10. The predetermined overhead rate is computed by dividing the estimated activity of the allocation base into the estimated manufacturing overhead costs. True False 11. The journal entry to apply manufacturing overhead costs to completed jobs credits either Applied Manufacturing Overhead or Manufacturing Overhead (Control). True False
12. At the end of the accounting period, manufacturing overhead costs are applied to uncompleted jobs using the same predetermined overhead rate that is used to apply manufacturing overhead costs to completed jobs. True False 13. Overapplied overhead occurs when the actual overhead costs incurred during a period are greater than the overhead costs applied during the period. True False 14. Underapplied overhead occurs when the actual overhead costs incurred during a period are greater than the overhead costs applied during the period. True False 15. Normal costing uses the actual allocation base activity to apply manufacturing overhead costs to jobs during the period. True False 16. Actual costing does not use a predetermined overhead rate to apply manufacturing overhead costs to jobs completed during the period. True False 17. Service organizations, by their nature, cannot have a balance in Work-in-Process Inventory. True False 18. Service organizations generally use the same job costing procedures as manufacturers. True False 19. It is unethical to intentionally charge costs to the wrong job. True False 20. One difference between jobs and projects is the account titles used in the costing process. True False
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