Managerial Accounting chp 19

The recording of the application of factory overhead costs to jobs would include a credit to

Factory Overhead

The recording of the factory labor incurred for general factory use would include a debit to

Factory Overhead

A manufacturing business reports just two types of inventory on its balance sheet: work in process inventory and finished goods inventory. Group of answer choices

False

A receiving report is prepared when purchased materials are first received by the manufacturing department.

False

Direct labor cost is an example of a period cost.

False

If factory overhead applied exceeds the actual costs, overhead is said to be underapplied.

False

Information about costs developed through a job order cost system cannot be used to evaluate an organization's cost performance.

False

The inventory accounts generally maintained by a manufacturing firm are only finished goods and materials.

False

The job order costing system is not used by service organizations.

False

The process cost system is appropriate where few products are manufactured and each product is made to customers' specifications.

False

The process cost system is appropriate where few products are manufactured and each product is made to customers' specifications. Group of answer choices

False

When goods are sold, their costs are transferred from Work in Process to Finished Goods.

False

Materials purchased on account during the month totaled $190,000. Materials requisitioned and placed in production totaled $165,000. The journal entry to record the material purchase on account is

Materials 190,000 Accounts Payable 190,000

Which of the following is the correct flow of manufacturing costs?

Raw materials, work in process, finished goods, cost of goods

A law firm would use a job order cost system to accumulate all of the costs associated with a particular client engagement, such as lawyer time, copying charges, filing fees, and overhead.

True

Cost accounting systems measure, record, and report product costs.

True

If the underapplied factory overhead amount is immaterial, it is transferred to Cost of Goods Sold at the end of the fiscal year.

True

In a job order cost accounting system for a service business, materials costs are normally included as part of overhead.

True

Materials are transferred from the storeroom to the factory in response to materials requisitions.

True

Nonmanufacturing costs are generally classified into two categories: selling and administrative.

True

The document that serves as the basis for recording direct labor on a job cost sheet is the time ticket.

True

Which of the following is the formula to calculate the predetermined factory overhead rate?

estimated total factory overhead costs divided

Each document in the cost ledger is called a

job cost sheet

Which of the following are the two main types of cost accounting systems for manufacturing operations?

job order cost and process cost systems

A widely used activity base for developing factory overhead rates in highly automated settings is

machine hours

Costs that are incurred in generating revenues during the period, but are not involved in the manufacturing process, are referred to as

product cost

In a job order cost accounting system, when goods that have been ordered are received, the receiving department personnel count the goods, inspect the goods, and complete a

receiving report

Period costs are classified as either

selling expenses or administrative expenses

The basis for recording direct and indirect labor costs incurred is a summary of the period's

time tickets

Which of the following costs are not included in finished goods inventory?

chief financial officer's salary

Job order costing and process costing are

cost accounting systems

In a job order cost accounting system, the entry to record the flow of direct materials into production is to

debit Work in Process, credit Materials