Order cost operations need to look to other

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order cost operations need to look to other information to plan and control production activities. c) The general ledger accounts do not provide the accounting information that managers of job order cost operations need to plan and control production activities. d) The general ledger accounts do not provide the accounting information that managers of job order cost operations need because of deficiencies in internal controls. The general ledger accounts usually do not provide the accounting information that managers of job order cost operations need to plan and control production activities. Item #1: The job order number is included on the job cost sheet. Item #2: Accumulated depreciation is not included separately on the job cost sheet. It will be included in the factory overhead general ledger account. Item #3: Direct labor is included on the job cost sheet. Item #4: Target cost is not included on the job cost sheet. Job order costing can usefully be applied to a service setting. The resulting job cost estimate can then be used to help determine a price for services. The architecture firm of Dream Design Company uses a job order cost system in pricing the home blueprints it designs for its clients. The company‘s predetermined overhead rate is 130% of direct labor cost (which, in this situation, is the amount paid to the company‘s designers). Dream Design Company estimates that it will take 32 labor hours (paying the designers $3,200) to complete the home designs for its client Joan Smitte. What is the total cost to Dream Design Company to complete this project? a) $940 b) $1,300 c) $7,360
d) $3,200 e) $4,160 The total cost to complete the project is $7,360, which is made up of the $3,200 to be paid to the designers and the $4,160 of overhead costs (or $3,200 × 130%). Costs of direct materials flow to the Work in Process Inventory account and to job cost sheets. Costs of indirect materials flow to the Factory Overhead account and to

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