ACC 2033 Exam 1

Réussis tes devoirs et examens dès maintenant avec Quizwiz!

A relevant cost....?

Differs between alternatives and pertains to the future

Manufacturing costs include

direct labor, direct materials and manufacturing overhead

Beg+raw-in-en=

direct materials BEG RAW - IN EN!!!!

Managers must review their internal system and report it to....?

reduce error and fraud

Average of unit=

total manufacturing cost divided by total units produced

Job order is ____________________ while process costing is _________________

unique product, custom homogenous, mass produced

Running processing equipment is which level in activity based costing?

unit level

individual customer or unit

unit level

in an automobile production line, assembly line workers are considered _____________ _______________ costs.

DIRECT labor

Predetermined overhead rate uses the....

DIRECT labor hours

DM= 300 DL=200 MOH= 400 what is prime cost? what is conversion cost?

DL+Dm= prime $500 Conversion= DL+ MOH $600

Sales- manufacturing=

Gross margin

Gemini had sales of $50,000. Cost of goods sold unadjusted was $23,000. Overapplied manufacturing overhead was $3,000. And selling and administrative expenses of $25,000. Calculate gross profit.

Gross profit = sales- cost of goods sold. MOH is over applied so you SUBTRACT $3000 from $23,000, equals $20,000. 50,000-20,000 = $30,000

Material are considered __________ costs when it's not worth the cost or effort to trace the product.

INDIRECT

sustainability means

company can meet today's needs without sacrificing future generations

Prime costs are...

direct labor + direct materials

Conversion costs are....

direct labor + manufacturing overhead

Labor time ticket will show

direct labor hours

Allocation base is based off of

direct labor hours, direct labor dollars or machine hours

Material requisition form will show

direct materials cost

Which of the following are most likely fixed costs? a. property taxes b. utilities c. rent d. administrative salaries

property taxes, rent and administrative salaries

implementing involves?

putting plan into action

Applied is recorded on

right or "credit" side

hotels and airlines are considered what kind of company?

service company

planning involves?

short term and long term objectives

activity rate =

total actiivity rate / total hours

An indirect cost are costs such a depreciation of oven, utilities, advertising. True or False

true

Product costs are manufacture costs, true or false

true

direct labor ---> WIP Indirect labor --> Manufacturing overhead true or false?

true

period costs are nonmanufacture costs true or false

true

If it's debit it is ___________ applied. If it's credit it's ___________ applied.

under over

A "just in time" system is...

used to help reduce costs, is a demand-pull system

Target costing is

what costs should be in order to earn an acceptable profit across the products life cycle

Direct labor is a ___________________ account on the journal entry

work in process

Raw materials inventory are transferred to either

work in process inventory or manufacturing overhead

do service firms have billable hours?

yes

managerial accounting is

-future -internal -as needed -by product

financial accounting is

-historical -GAAP guided -external -periodically -whole company

COG MAnufactured formula?

Beginning WIP +total manufactured costs - ending WIP

Unadjusted cost of goods sold equals...?

Beginning finished goods inventory + cost of goods manufactured - ending cost of goods inventory

total manufacturing costs + beginning WIP - ending WIP =????

COG manufactured

Prepare a journal entry to transfer OH balance to COGS of 34,000

COGS 34,000 MOH 34,000

Identifying a problem and conducting a plan to fix it is which function?

Control

Milton Corp. sold goods costing 50,000 for 75,000. You would debit....?

Cost of goods sold for 50,000 and Accounts receivable for 75,000

What accounts are affected in over or under applied?

Increase or debit COGS Decrease or credit MOH

How do you calculate ending finished goods inventory?

Job 201 beginning finsihed goods inventory + Direct materials + direct labor + MOH= finished goods inventory

record actual and applied in a journal entry for the following : estimated total OH cost = 325,000 estimated machine hrs = 25,000 actual MOH= 372000 actual machine hours= 26000

MOH 372,000 Cash/Ap/Raw Mat 372,000 WIP 338,000 MOH 338,000

What is the primary difference between financial and managerial accounting??

Managerial provides information for the internal users, while financial provides info for external users.

Product costs are known as what type of cost, and which do they relate to?

Manufacturing cost & relate to making the product

What document specifies the type and quantity of materials used on a specific job?

Material requisition form

wholesalers and retail companies are both kinds of _____________ companies?

Merchandising

Period costs are known as what type of cost and they relate to?

Non-manufactoring costs & relate to delivering and selling the product

Purchase $20,000 worth of materials on account

Raw materials inventory $20,000 ACC Pay $20,000

DM= $300 Overhead applied is 200% of direct labor cost The total manufacturing cost is $900 How do you solve?

Total manufacturing = DM+ DL+ MOH so...... you take 900= 300 + DL + DL(2) 600= 3DL 600/3= 200 200= Direct Labor cost MOH = 400

True or false? Managers need more detail than financial reports can capture.

True

If you have indirect an direct labor costs , the account credited is?

Wages payable

Anything that goes to a job will be debited in the journal entry as?

Work in process

when manufacturing overhead is applied, the _______________ account is debited.

Work in process

Is it impossible or difficult to trace MOH costs?

YES

estimated total OH cost = 325,000 estimated machine hrs = 25,000 actual MOH= 372000 actual machine hours= 26000 a. predetermined OH rate? b. Applied MOH? c. Over or under applied MOH?

a. $13 b. 338,000 c. under applied by 34,000

the cost of goods manufactured is the sum of?

all amounts transferred from work in process to finished goods in the same period

Processing a purchase order is which level in activity based costing?

batch level

group or batch

batch level

How do you find direct materials used??

beg. raw materials + raw materials produced - indirect materials - ending raw materials

COGS= ???

cost of goods manufactured + beginning finished goods - ending finished goods

Raw material --> work in process --> finished goods -> once the product is sold, it is called

cost of goods sold

completed and sold would be completed and not sold would be in process would be

cost of goods sold finished goods work in process

Reports that detail resources required to prevent, correct or detect problems are

cost of quality reports

If it's overapplied, the Cost of goods needs to be _______________

decreased

Traditional costing systems tend to overcost high volume products because?

don't allow for complex activities and use more labor & machine hours

estimated total cost driver also means

estimated direct labor cost

To calculate the predetermined overhead rate, divide estimated total manufacturing overhead by the??

estimated total cost driver, or the estimated direct labor hours if that is the allocation base.

Examples of indirect labor costs include?

factory security guards, factory supervisors and restaurant kitchen managers. **not kitchen cooks**

when goods are sold on account, which accounts are credited?

finished goods inventory and sdales revenue

Process costing is used for

homogenous (same) product and mass production

manufacturing overhead includes

indirect labor

Factory costs such as cleaning supplies, taxes, insurance and janitor wages are classified as?

manufacturing overhead

Payroll, supervisors etc. is an indirect labor cost. that falls under whch category? period direct labor direct material or manufacturing overhead

manufacturing overhead

To calculate manufacturing overhead using ABC you divide total

manufacturing overhead by total items produced

Indirect labor is a ____________________ account on the journal entry

manufacturing overhead cost

Inside the factory is

manufacturing overhead cost

Rent, insurance, utilities, indirect labor, production supervisor salary, insurance and depreciation are all..?

manufacturing overhead costs

Manufacturing costs include?

manufacturing overhead, direct labor and direct materials

Manufacturing overhead costs include

material and labor, indirect costs and they must be manufacturing costs

controlling involves?

measuring and monitoring

Net operating income is ...?

net operating income= Gross profit - selling and administrative expenses

Estimated direct labor cost is 600,000. Estimated MOH is 900,000. actual direct labor cost in 550,000 actual MOH is 850,000. what is the predetermined overhead rate? what is the applied over head? is it under or over applied?

predetermined rate is = 1.50% (MOH/DL) applied OH is = 825,000 (predetermined rate * DL) Is it under or over? Actual was 850,000. Applied was 825,000 Actual Applied 850,000 825,000 25,000 under.

research and development is a _____________ level

product

Maintaining inventory parts for products is which level in activity based costing?

product level

specific product or offer?

product level

sales- targeted cost =??

target profit

Total life cycle=

targeted cost * units* years

Record the purchase of $150,000 raw materials on account

DR: Raw materials inventory $150,000 CR: Accounts payable $150,000

Issued $100,000 of raw materials to job 2719 and $40,000 to Job 3335. Indirect materials $10,000 issued.

DR: Work in Process $140,000 DR: Manufacturing overhead $10,000 CR: Raw materials $150,000

A ________ cost does not change in total, and a ___________ cost does not change per unit.

FIXED does not change in total VARIABLE cost does not change per unit

Factory management salaries is which level in activity based costing?

Facility level

activity that supports whole company?

Facility level

when a job is FINISHEd, which account is debited?

Finished goods inventory

Cost of goods manufactured report summarizes?

Raw materials to work in process inventory to finished goods

If it's over-applied you must subtract or add to COG?

SUBTRACT

You can calculate work in process inventory by?

Summing all sales values of jobs in process

Making a direct adjustment to costs of goods sold is the ....?

best way to close out over/under applied MOH

Depreciation on factory equipment depreciation on delivery trucks wood used to build bookcase Production supervisor salary glue and screws used in bookshelf wages of people who assembled bookshelf cost to run an advertisement rent for factory CEO salary wages of persons who sands the wood

1. manufacturing overhead 2. period cost 3. direct material 4. manufacturing overhead 5. manufacturing overhead 6. direct labor 7. period cost 8. manufacturing overhead 9. Period cost 10. direct labor

Estimated to spend $89600 with 2,000 direct labor hours. Actual was $11,000. What was the applied manufacturing overhead?

89600/2000= $8 $8*$11,000 = $88,000

which is irrelevant and should be disregarded when making decisions? opportunity, sunk or differential?

Sunk costs should not be considered when making the decision to continue investing in an ongoing project, since these costs cannot be recovered.

Direct costs are ___________ to products while overhead costs are ______________

TRACED & APPLIED

A direct cost is easily traced to product. True or False

TRUE

Period is outside costs an manufacturing overhead is inside costs, true or false?

TRUE

which of the following is not a volume based cost driver? -direct labor dollars -direct material costs -sales revenue -machine set ups

machine set ups, this is an ABC batch level cost driver

Which method can be used to dispose of under or over applied manufacturing overhead?

make a direct adjustment to the cost of goods sold account OR allocate it to work in process, finished goods or cost of goods sold

Predetermined overhead rate is multiplied by the actual cost driver to calculate....

overhead applied to

outside factory is

period or nonmanufacturing costs

Manufacturing overhead is assigned using?

predetermined overhead rate


Ensembles d'études connexes

Chapter 7 Quiz Public Speaking: Interesting Verbal and Visual Supporting Materials

View Set

Ch. 16- Care of Postoperative Patients

View Set

Модуль 76 Give, keep and miss

View Set

Ch. 8 Smartbook--An Introduction to Microbial Metabolism

View Set

ML4T Questions >= 4 rating, >=3 Votes

View Set