Accounting 2020 Chapter 3

Costs of partially completed units are accounted for in _________

Work in process

The Manufacturing Overhead account is debited when:

actual overhead costs are incurred

The value of work in process is equal to:

the cost of all unfinished jobs

To calculate a predetermined overhead rate, divide estimated manufactoring overhead by:

estimated allocation base

A journal entry that debits Manufacturing overhead and credits prepaid insurance records the:

expiration of prepaid factory insurance

When labor costs are incurred, ____ are added directly to the Work in Process account.

only direct labor costs

A journal entry that debits Raw Materials and credits Accounts Payable is recording the:

purchase of materials

A journal entry that debits Manufacturing overhead and credits Accounts payable could be made to record:

rent expense on factory equipment, factory utilities expense

net operating income calculated by subtracting

selling and administrative expenses from gross margin

In normal costing system, Work in Process is debited for:

Cost of direct materials, direct labor, and manufacturing overhead applied

The amount transferred from Work in Process to Finished Goods is:

Cost of goods manufactured

What accounts are debited when goods are sold on account?

Cost of goods sold and accounts receivable

When a job is completed, which account is debited?

Finished goods

When goods are sold on account, what accounts are credited?

Finished goods and sales

The journal entry to record accrued property taxes for a factory building debits:

Manufacturing overhead and credits property taxes payable

The schedule of cost of goods ____ summarizes costs that remain in Finished goods inventory and that have been transferred to Cost of goods sold.

Sold

To calculate the adjusted cost of goods sold:

add underapplied overhead to or subtract overapplied overhead from unadjusted cost of goods sold.

The journal entry to record general selling and administrative costs debits:

an expense account and credit cash or a liability

A journal entry to record depreciation on office equipment debits:

depreciation expense and credits accumulated depreciation

Underapplied and overapplied overhead is the:

difference between overhead applied to work in process and actual overhead

Labor costs charged to Manufacturing Overhead represent:

indirect labor costs

Manufacturing overhead consists of all:

manufacturing costs other than direct labor and direct materials

What account is debited to record indirect labor costs?

manufacturing overhead

Actual overhead costs may not be proportional to the actual amount of the allocation base used because

many actual overhead costs are fixed, overhead spending may not be under control

The journal entry to record the issuance of direct materials into production debits:

work in process

Preparing financial statement in a job-order costing system

balance sheet, income statement

Finished goods _____

consists of completed, unsold goods

Calculate cost of goods sold available for sale on the schedule of cost of goods sold

costs of goods manufactured, beginning finished goods inventory