ACC 255 Exam 1

occurs when finished jobs are shipped to customers

to remove cots of units sold- we debit the cost of goods sold

partially complete units

work in process

when companies incur selling and admin costs, those costs

do not flow through inventories on the balance sheet

period costs

don not flow thru inventories

formula for predetermined overhead rate

estimated manufacturing overhead cost divided by estimated allocation base

Completed units that have not yet been sold are found in ____________ __________ inventory.

finished goods

finished goods is debited

fiwhen a job is completed

schedule of cost of goods manufactured

includes: direct materials used in production + direct incurred labor costs + man overhead applied

clearing account

man overhead

when labor costs are incurred, ______ are added directly to the work in process account

only direct labor costs

example: over/underapplied? manufacturing overhead applied = $150,000 Actual amount of manufacturing overhead costs = $120,000

Credit: $30,000 over-applied

a journal entry that debits depreciation expense and creits accumulated depreciation records

depreciation of office equipment

Labor costs charged to Manufacturing Overhead represent:

indirect labor costs

which account is credited when manufacturing overhead is applied?

manufacturing overhead

product costs =

manufacturing overhead costs, raw materials and direct labor

applied manufacturing overhead will most likely ____ actual manufacturing overhead

not equal

Overapplied overhead would result when:

overhead applied exceeds actual overhead costs

journal entry to record issuing materials to be used in production credits

raw materials

true

raw materials inventory represent the cost of materials not yet used in production

a journal entry that debits ads expense and credits cash would record the incurrence of a

selling cost

issuing both direct and indirect materials into production debits

work in process and manufacturing overhead costs

when a job is completed

work in process is credited

journal entry to record $10,000 in manufacturing overhead debits

work in process$10,000 and credits man overhead

work in process

debited to record direct labor costs

journal entry to record a cash payment of $400 for insurance on administrative office equipment:

debits insurance expense and credits cash

if the manufacturing overhead cost is closed to COGS

decrease cost of goods sold

Milton corp sold goods costing $50,000 for $75,000

Cost of goods sold for $50,000 and accounts receivable for $75

issuance of materials

a journal entry that debits work in process and manufacturing overhead and credits raw materials records the:

charged directly to an income statement

administrative costs and selling costs

a journal entry debiting salaries expense and crediting salaries and wages payable record

administrative salaries

the journal entry to record general selling and admin costs debits

an expense account and credits cash or a liability

debit work in process and credits man overhead

application of manufacturing overhead costs

underapplied overhead

applied overhead is LESS Than Actual Overhead

unadjusted cost of goods sold

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

the amount transferred from work in process to finished goods is

cost of goods manufactured

when goods are sold on account

cost of goods sold and accounts receivable are debited

if the manufacturing overhead account is closed proportionally to work in process, finished gooods and Cogs

credit COGS

when a job is completed and transferred to the finished goods warehouse

credit work in process

when manufacturing overhead is applied to work in process

debit - work in process credit- man overhead

withdrawal of raw materials from a store room for use as indirect and direct materials in production

debit - work in process debit- man overhead credit- raw materials

company recognizes $1000 of accrued property taxes on its manufacturing facility

debit manufacturing overhead $1000 and credit property taxes payable $1,000

use of direct and indirect labor in production

debit- work in process, debit- man overhead credit- salaries and wages payable

true

when materials are purchased they are recordedin RAW materials inventory account