bus 215 ch 3

cost of goods manufactured includes

the manufacturing costs of goods finished during the period

true or false: raw materials inventory include any materials that are used in production both direct and indirect

true

the journal entry to record the purchase of materials credits

accounts payable

overhead is undersupplied if

actual overhead is more than applied overhead

overapplied or underapplied overhead is the difference between

actual total overhead and total overhead applied

overapplied or undersupplied overhead is the difference between

actual total overhead and total overhead applied

applied manufacturing overhead is entered on what side of the manufacturing overhead account

always the credit side

raw materials inventory is an

asset

underapplied or overapplied manufacturing overhead can be disposed of by

closing it out to cost of goods sold or allocating it among work in process, finished goods and cost of goods sold

finished goods consist of

completed, unsold goods

what 2 accounts are involved when undersupplied or overapplied overhead is closed out using the simpler method?

cost of goods sold and manufacturing overhead

if overapplied overhead is closed out to cost of goods sold, the cost of goods sold account will be

decreased

the journal entry to record depreciation on office equipment debits

depreciation expense and credits accumulated depreciation

a journal entry that includes manufacturing overhead and cost of goods sold is recorded to

dispose of undersupplied or overapplied overhead

a journal entry that involved manufacturing overhead, work in process, finished goods, and cost of goods sold is recorded to

dispose of undersupplied or overapplied overhead

true or false: period costs flow from finished goods to cost of goods sold

false

when the jobs are sold their costs are transferred out of

finished goods

labor costs charged to manufacturing overhead represent

indirect labor costs

the journal entry to record a cash payment of $400 for insurance on administrative office equipment debits _______ and credits cash

insurance expense

which of the following is a clearing account

manufacturing overhead

the journal entry to record $20,000 in depreciation on factory equipment is debit

manufacturing overhead $20,000 and credit accumulated depreciation $20,000

the journal entry to record accord property taxes for a factory building debits

manufacturing overhead and credits property taxes payable

overhead is applied to work in process

manufacturing overhead is credited

the period ends

manufacturing overhead is credited

actual overhead is incurred

manufacturing overhead is debited

the journal entry to record the purchase of materials debits

raw materials

any purchased materials that will go into the finished product are first recorded in the

raw materials inventory account

a journal entry that debits advertising expense and credits cash would record the incurrence of a

selling cost

the value of work in process is equal to

the cost of all unfinished jobs

applied manufacturing overhead is entered on what side of the manufacturing overhead account?

always the credit side

what side of the manufacturing overhead account is actual manufacturing overhead entered on?

always the debit side

a journal entry that debits work in process and credits manufacturing overhead is recording the

application of manufacturing overhead costs

a predetermined overhead rate is calculated by dividing the _______ total manufacturing overhead by the ______ total amount of the allocation base

estimated; estimated

manufacturing overhead is applied with a debit to

work in process

which account(s) are debited in the journal entry to record manufacturing labor costs

work in process and manufacturing overhead

applied manufacturing overhead will most likely ______ actual manufacturing overhead

not equal

units of product that are only partially complete are contained in the

work in process inventory

the cost of jobs still unfinished at the end of a period are included in

ending work in process inventory

true or false: underapplied or overapplied overhead occurs because overhead is applied to jobs using a predetermined rate based on estimates of costs and activity levels

true