Test 1; Chapter 3

Fillia Inc worked on three jobs this period: Job 14c, which costs 15000; Job 23a which costs 28000, and job 45b which costs 23000. At the end of the period, only Job 14c was still in process (unfinished). The cost of goods manufactured this period is _____?

$51000. The cost of goods manufactured is the cost of jobs completed during the peropd (jobs 23a and 45b).

schedule of cost of goods sold

1. finished goods inventory, 2. add: cost of goods manufactured, 3. cost of goods available for sale, 4. deduct: finished goods inventory, ending, 5. unadjusted cost of goods sold.

steps for calculating direct materials on the schedule of cost of goods manufactured in order

1. raw materials, beginning, 2. add: purchases of raw materials, 3. total raw materials available, 4. deduct: raw materials inventory, ending, 5. raw materials used in production, 6. deduct: indirect materials included in manufacturing overhead

place these items from the income statement in the order in which they should appear

1. sales, 2. cost of goods sold, 3. gross margin, 4. selling and admin, 5. net operating income

schedule of costs of goods manufactured...

1. total manufacturing costs. 2. add: beginning work in process inventory. 3. deduct: ending work in process inventory. 4. cost of goods manufactured

Which are widely used allocated bases in manufacturing?

1. units of product, direct labor hours, machine hours, direct labor cost

Which of the following is not one of the categories into which manufacturing costs are generally classified? 1. direct materials, 2. manufacturing overhead, 3. selling and administrative expenses, 4. direct labor

3. selling and administrative expenses

which of the following is NOT a reason why assigned manufacturing overhead to a specific job can be difficult? 1. manufact overhead consistis of many different items, . manufact overhead is an indirect costs, 3. manufact overhead contains fixed costs, 4. manufact overhead is directly traceable to units produced

4. manufacturing overhead is directly traceable to units produced.. manufacturing overhead is an indirect cost and must be allocated.. it cannot be directly traced to units produced

Smith inc uses a job-order costing system with the predetermined overhead rate of $12 per machine hours. The job cost sheet for job #42a listed 12000 in direct labor cost, 18000 in direct materials cost, 1200 direct labor hours and 1100 machine hours. The total cost of Job #42a is ___?

43200... total cost of job #42a= direct materials + direct labor + predetermined overhead rate x actual machine hours = (18000+12000 + (12x 1100)= 43200

What kinds of manufacturing costs are assigned to units of product in absorption costs?

Both variable and fixed manufacturing costs

__ ___ inventory consists of completed units that have not yet been sold.

Finished goods

Which of the following are true of manufacturing overhead?

It must be a manufacturing cost, it can include materials and labor (indirect materials and indirect labor are both included), and it must be an indirect cost

manufacturing overheads consists of...

all costs other than direct labor and direct materials, only manufacturing costs go into manufacturing overhead

a measure of activity used to assign overhead costs to products and services and sometimes called a cost driver is a..

allocation base

Manufacturing overhead costs

are indirect costs, and consist of many different items, and total manufacturing costs tend to remain relatively constant due to the presence of fixed costs. units produced fluctuate which causes the average cost per unit to vary

what methods can be used to dispose of underapplied or overapplied manufacturing overhead?

closing out cost of goods sold and allocating it among work in process, finished goods, and cost of goods sold

Typical cost drivers include:

computer time, machine hours, flight hours

the journal entry to record the more accurate allocation of overapplied or underapplied overhead involves which of the following accounts?

cost of goods sold, manufacturing overhead, work in process, finished goods

a company incurred 10000 in direct labor costs and 8000 in indirect labor costs. the journal entry is...

debit work in process 10000, debit manufacturing overhead 8000, and credit salaries and wages payable 18000

what is the difference between direct labor and indirect labor?

direct labor can be easily traced to jobs, while indirect labor cannot

Labor costs tat are easily traced to a job are....

direct labor costs

which of the following are widely used allocation bases in manufacturing?

direct labor hours, direct labor costs, units of production, machine hours

Which of the following costs can be directly traced to a particular product?

direct materials and direct labor

which of the following costs would be classified as manufacturing overhead?

factory utilities and maintenance wages

When a job is completed, its costs are transferred into...

finished goods

what kind of cost is manufacturing overhead?

indirect

A journal entry that debits "Work In Process" and "Manufacturing Overhead" and credits "Materials" records the....

issuance of materials

which of the following is true of manufacturing overhead?

it can include materials and labor, it must be an indirect cost, and it must be a manufacturing cost

factory rent is considered...

manufacturing overhead

the period ends and...

manufacturing overhead is closed

a job is completed and...

manufacturing overhead is credited

actual overhead is incurred and....

manufacturing overhead is debited

what is the formula for applying overhead to a specific job?

predetermined overhead rate x amount of allocation base incurred by job

A journal entry that debits raw materials and credits accounts payable is recording the

purchase of materials

__ ___ consist of any materials that go into the finished product

raw materials

which of the following costs are charged directly to the income statement?

selling and admin

the ____ summarized costs that remain in work in process inventory and that have been transferred from work in process to finished goods inventory

the cost of goods manufactured

a journal entry that debits manufacturing overhead and credits accounts payable could record which of the following transactions?

the incurrence of factory utilities and the incurrence of rent on factory equipment

__ __ __ consists of units that are only partially complete.

work in process