ACC212 (final) Chapter 15

(c)it manufactures products with unique characteristics.

A company is more likely to use a job order cost system if: (a)it manufactures a large volume of similar products. (b)its production is continuous. (c)it manufactures products with unique characteristics. (d)it uses a periodic inventory system.

(c)makes an adjusting entry by debiting Cost of Goods Sold for $1,200 and crediting Manufacturing Overhead for $1,200.

At end of the year, a company has a $1,200 debit balance in Manufacturing Overhead. The company: (a)makes an adjusting entry by debiting Manufacturing Overhead Applied for $1,200 and crediting Manufacturing Overhead for $1,200. (b)makes an adjusting entry by debiting Manufacturing Overhead Expense for $1,200 and crediting Manufacturing Overhead for $1,200. (c)makes an adjusting entry by debiting Cost of Goods Sold for $1,200 and crediting Manufacturing Overhead for $1,200. (d)makes no adjusting entry because differences between actual overhead and the amount applied are a normal part of job order costing and will average out over the next year.

(b)from the Work in Process Inventory account.

At the end of an accounting period, a company using a job order cost system calculates the cost of goods manufactured: (a)from the job cost sheet. (b)from the Work in Process Inventory account. (c)by adding direct materials used, direct labor incurred, and manufacturing overhead incurred. (d)from the Cost of Goods Sold account.

(a)product costs.

Cost accounting involves the measuring, recording, and reporting of: (a)product costs. (b)future costs. (c)manufacturing processes. (d)managerial accounting decisions.

(b)$144,000.

In Crawford Company, the predetermined overhead rate is 80% of direct labor cost. During the month, Crawford incurs $210,000 of factory labor costs, of which $180,000 is direct labor and $30,000 is indirect labor. Actual overhead incurred was $200,000. The amount of overhead debited to Work in Process Inventory should be: (a)$200,000. (b)$144,000. (c)$168,000. (d)$160,000.

(b)Raw Materials Inventory.

In accumulating raw materials costs, companies debit the cost of raw materials purchased in a perpetual system to: (a)Raw Materials Purchases. (b)Raw Materials Inventory. (c)Purchases. (d)Work in Process.

(b)debit Finished Goods Inventory.

In recording the issuance of raw materials in a job order cost system, it would be incorrect to: (a)debit Work in Process Inventory. (b)debit Finished Goods Inventory. (c)debit Manufacturing Overhead. (d)credit Raw Materials Inventory.

(b)actual overhead is greater than applied.

Manufacturing overhead is underapplied if: (a)actual overhead is less than applied. (b)actual overhead is greater than applied. (c)the predetermined rate equals the actual rate. (d)actual overhead equals applied overhead.

(c)debit Finished Goods Inventory $4,500 and credit Work in Process Inventory $4,500.

Mynex Company completes Job No. 26 at a cost of $4,500 and later sells it for $7,000 cash. A correct entry is: (a)debit Finished Goods Inventory $7,000 and credit Work in Process Inventory $7,000. (b)debit Cost of Goods Sold $7,000 and credit Finished Goods Inventory $7,000. (c)debit Finished Goods Inventory $4,500 and credit Work in Process Inventory $4,500. (d)debit Accounts Receivable $7,000 and credit Sales Revenue $7,000.

(d)the materials are issued by the materials storeroom.

Raw materials are assigned to a job when: (a)the job is sold. (b)the materials are purchased. (c)the materials are received from the vendor. (d)the materials are issued by the materials storeroom.

(a)Work in Process Inventory and a credit to Factory Labor.

The entry when direct factory labor is assigned to jobs is a debit to: (a)Work in Process Inventory and a credit to Factory Labor. (b)Manufacturing Overhead and a credit to Factory Labor. (c)Factory Labor and a credit to Manufacturing Overhead. (d)Factory Labor and a credit to Work in Process Inventory.

(c)parallels the physical flow of materials as they are converted into finished goods.

The flow of costs in job order costing: (a)begins with work in process inventory and ends with finished goods inventory. (b)begins as soon as a sale occurs. (c)parallels the physical flow of materials as they are converted into finished goods. (d)is necessary to prepare the cost of goods manufactured schedule.

(d)Any of the above.

The formula for computing the predetermined manufacturing overhead rate is estimated annual overhead costs divided by an expected annual operating activity, expressed as: (a)direct labor cost. (b)direct labor hours. (c)machine hours. (d)Any of the above.

(d)materials requisition slips, time tickets, and the predetermined overhead rate.

The source of information for assigning costs to job cost sheets are: (a)invoices, time tickets, and the predetermined overhead rate. (b)materials requisition slips, time tickets, and the actual overhead costs. (c)materials requisition slips, payroll register, and the predetermined overhead rate. (d)materials requisition slips, time tickets, and the predetermined overhead rate.

(c)Factory Labor.

When incurred, factory labor costs are debited to: (a)Work in Process. (b)Factory Wages Expense. (c)Factory Labor. (d)Factory Wages Payable.

(c)Job order costing provides more precise costing for custom jobs than process costing.

Which of the following statements is true? (a)Job order costing requires less data entry than process costing. (b)Allocation of overhead is easier under job order costing than process costing. (c)Job order costing provides more precise costing for custom jobs than process costing. (d)The use of job order costing has declined because more companies have adopted automated accounting systems.