Exam 1 (Chapter 18-19)

Requirement 2. Classify​ Lawlor's costs as period costs or product costs. If the costs are product​ costs, further classify as direct​ materials, direct​ labor, or manufacturing overhead. 1. Shaft and handle of weed trimmer 2. Motor of weed trimmer 3. Factory labor for workers assembling weed trimmers 4. Nylon thread used by the weed trimmer​ (not traced to the​ product) 5. Glue to hold housing together 6. Plant janitorial wages 7. Depreciation on factory equipment 8. Rent on plant 9. Sales commissions 10. Administrative salaries 11. Plant utilities 12. Shipping costs to deliver finished weed trimmers to customers

1. Direct Materials 2. Direct Materials 3. Direct Labor 4. Manufacturing Overhead 5. Manufacturing Overhead 6. Manufacturing Overhead 7. Manufacturing Overhead 8. Manufacturing Overhead 9. Period Cost 10. Period Cost 11. Manufacturing Overhead 12. Period Cost

Would the following companies most likely use job order costing system or process costing​ system? 1. Paint manufacturer 2. Print shop 3. Caterer 4. Soft drink bottler 5. Yacht builder

1. Process costing 2. Job order costing 3. Job order costing 4. Process costing 5. Job order costing

Which one of the following companies is most likely to use job order​ costing?

A law firm

Would an advertising agency use job order or process​ costing? What about a cell phone​ manufacturer?

Advertising agency—job order​ costing ; Cell phone manufacturer—process costing

Manufacturers follow four steps to implement a manufacturing overhead allocation system. The last step is?

Allocate some manufacturing overhead to each individual job.

Which of the following statements is true of costing​ systems?

An accounting firm would likely use a job order costing system.

When is the predetermined manufacturing overhead rate​ computed?

Before the period starts

Over Allocated Overhead

Costs occur when the actual manufacturing overhead costs are less than allocated manufacturing overhead costs.

The job cost record summarizes which of the following sets of information for each​ job?

Direct​ materials, direct​ labor, and manufacturing overhead

Service

Does not sell products. They sell time, skills, and knowledge.

Use of the Internet for business functions such as sales and customer service. Enables companies to reach customers around the world.

E-Commerce

Software system that integrates all of a​ company's functions,​ departments, and data into a single system.

ERP

Which is not a characteristic of management accounting​ information?

Emphasizes the external financial statements

Financial Accounting

Focuses on providing information for external decision makers.

Managerial Accounting

Focuses on providing information for internal decision makers.

A system in which a company produces products just when they are needed to satisfy needs. Suppliers deliver materials when they are needed to begin​ production, and finished units are completed at the right time for delivery to customers.

JIT

​An ________ is an estimated manufacturing overhead rate computed at the beginning of the year.

Predetermined manufacturing overhead rate

Merchandising

Resells products previously bought from suppliers.

A philosophy designed to integrate all organizational areas in order to provide customers with superior products and services while meeting organizational objectives. Requires improving quality and eliminating defects and waste.

TQM

Cost accounting systems are used _______.

To accumulate product cost information

Evaluating a​ company's performance by its​ economic, social, and environmental impact.

Triple Bottom Line

Manufacturing

Uses labor, equipment, supplies, and facilities to convert raw materials into new finished products.

In the basic flow of inventory through a manufacturing​ system, which of the following occurs second in the job costing​ system?

Work in process inventory

A typical manufacturing overhead cost would be

depreciation on the plant.