Chapter 3 Job-Order Costing: Cost Flows and External Reporting
Depreciation Expense
Assume there is a $7,000 Depreciation Expense on Office Equipment. The manufacturing company should debit (Depreciation Expense/Manufacturing Overhead) and credit Accumulated Depreciation.
MFOH Account
Companies also incur selling + administrative costs. These costs should be treated as period expenses and charged directly to the IS. These nonmanufacturing costs should not go into the ____!
COGS, WIP, Finished Goods, COGS
Disposing of Overapplied/Underapplied Overhead can be closed out to ____ or proportionately to ____, ____, and ____
Beginning Finished Goods inventory, COGM, Ending Finished Goods inventory
How is the unadjusted Cost of Goods Sold found? Unadj. COGS = ____ + ____ - ____
WIP to Finished Goods
The amount transferred from ____ is referred to as the Cost of Goods Manufactured. This accounts for the manufacturing costs associated with units of product that were finished during the period. As jobs are sold, their costs are transferred from Finished Goods to Cost of Goods Sold. At this point the various costs attached to each job are finally recorded as an expense on the income statement. Until that point these costs are inventory accounts on the balance sheet.
WIP inventory, WIP, Finished Goods
The schedule of COGM summarizes the portions of those costs that remain in ending ___ and are transferred out of ____ into ____
Finished Goods inventory, Finished Goods, COGS
The schedule of COGS summarizes the portions of those costs that remain in ending ____ and that are transferred out of ____ into ____
Three, Direct Materials, Direct Labor, Manufacturing Overhead
The schedule of Cost of Goods Manufactured contains ___ elements of product costs which are?
False
True or False? Only actual overhead appears on a job cost sheet
True
True or False? Raw Materials include any materials that go into the final product.
True
True or False? The Manufacturing Overhead Account acts as a clearing account.
C.) Add the cost of the units shipped to Cost of Goods sold.
What should the manufacturing companies accounting department do with the Cost of Goods Sold account in a situation where only a portion of units involved in a particular job are sold? A.) Wait till the end of the period. B.) Leave in Finished Goods. C.) Add the cost of the units shipped to Cost of Goods sold.
Unit Product Cost, Finished Goods, COGS
When accounting for a portion of the total units for a particular job after being shipped, it is necessary to use the ____ to determine how much product cost should be removed from ____ and charged to ____.
Debits, Credit, Credits
Actual manufacturing overhead costs are recorded as ____ to the Manufacturing Overhead account while the applied manufacturing overhead is recorded on the ____ side of the MFOH account. At the end of the period the MFOH cost added to all jobs within that timespan will equal the amount of the ____ recorded in the MFOH account during that period.
Transfer, COGM
A ____ of costs is made within the costing system that parallels the physical transfer of goods to the finished goods warehouse. The costs of the completed job are transferred out of the WIP account and into the Finished Goods account. The sum of all amounts transferred between the two represents the ____ for the period.
Three, Balance Sheet, Income Statement
A job order costing company's product costs flow through ____ inventory accounts one the ____ ____ and then on to the cost of goods sold on the ____ ____.
Debited
Actual Manufacturing Overhead costs are ____ on the account as they incurred throughout the year.
Don't
Actual overhead costs are not charged to jobs; actual overhead costs (do/don't) appear on the job cost sheet nor do they appear in the WIP account. Only the applied overhead cost, based on the "PDOH", appears on the job cost sheet and WIP account.
selling and admin expenses
Period costs (or ____) do not flow through inventories on the balance sheet. They are recorded as expenses on the income statement in the period incurred.
Raw Material Inventory
Raw Materials purchases are recorded in the ____ account.
Underapplied, $5,000
Ruger Corporation had applied overhead of $90,000 and actual overhead of $95,000. The overhead is ____ by ____
Overapplied, $5,000
Ruger Corporation had applied overhead of $95,000 and actual overhead of $90,000. The overhead is ____ by ____
Work In Process inventory, units of product, direct labor cost, Finished Goods Inventory
When raw materials are used in productions as direct materials, their costs are transferred to ____. Work in Process consists of ____ that are only partially complete and will require further work before they are ready for sale to the customer. To transform direct materials into completed jobs, ____ is added to Work in Process and manufacturing overhead cost is applied to WIP by multiplying the predetermined overhead rate by the actual quantity of the allocation base consumed by each job. When jobs are completed their costs are transferred from WIP to ____. Finished Goods consist of completed units of product that have not yet been sold to customers.
COGS
As completed jobs are shipped to customers, their accumulated costs are transferred from Finished Goods to ____.
Predetermined Overhead Rate, Debited, Credited
When jobs are completed/period ends, overhead cost is applied to the jobs using the ____, WIP is ____ and Manufacturing Overhead is ____
Three, Direct Materials, Direct Labor, Manufacturing Overhead
The schedule of Cost of Goods Sold also contains ____ elements of product costs: ____
Beginning Raw Material inventory, Purchases of Raw Materials, Ending Raw Materials Inventory
How are Raw Materials used in Production Computed? Raw Materials Used in Production = ____ + ____ - ____
Direct Materials, Direct Labor, MFOH Applied to WIP
How are Total Manufacturing Costs found? Total Manufacturing Cost = ____ + ____ + ____
Total Manufacturing Costs, Beginning WIP Inventory, Ending WIP Inventory
How is the Cost of Goods Manufactured found? COGM = ____ + ____ - ____
