ACC 3013 - Chapter 4

Billy Baroo Company uses a job order cost system. The following information was found in the Work-in-Process account for the month of July. July 1 - Balance: 12,000 July 31 - Direct Labor: 38,000 July 31 - Direct Materials: 52,000 July 31 - Factory Overhead: 30,400 July 31 - Transfer to Finished Goods: (80,000) Billy Baroo applies overhead to production at a predetermined rate of 80% based on the direct labor cost. Job #23, the only job still in process at the end of July, has been charged with direct labor of $12,000. Direct material charged to Job #23 was: a. $30,800. b. $22,560. c. $40,400. d. $52,400. e. $32,100.

a

Blue Sky Incorporated listed the following data for the current year: Budgeted factory overhead $ 1,271,000 Budgeted direct labor hours 82,000 Budgeted machine hours 41,000 Actual factory overhead 1,201,000 Actual direct labor hours 86,300 Actual machine hours 39,400 Assuming Blue Sky Incorporated applied overhead based on machine hours, the firm's predetermined overhead rate for the current year rounded to 2 decimal places is: a. $31.00 per machine hour. b. $37.41 per machine hour. c. $32.25 per machine hour. d. $33.50 per machine hour. e. $28.42 per machine hour.

a

In job costing, the job might consist of: a. a single product, a batch of products, or a single well-defined project. b. a batch of similar products. c. a single product. d. a batch of identical products. e. a single, well-defined project.

a

Product costing provides useful cost information for all the following except: a. Identifying and hiring competent managers. b. Both manufacturing and non-manufacturing firms. c. Financial statement reporting. d. Management planning, cost control, and performance evaluation. e. For non-manufacturing firms.

a

Which of the following industries is more suitable for using a job costing system? a. Medical clinics. b. Petroleum product manufacturing. c. Chemical plants. d. Food processing. e. Cement manufacturing.

a

Which one of the following is the amount that actual factory overhead exceeds the factory overhead applied? a. Underapplied overhead. b. Actual factory overhead. c. Overapplied overhead. d. Allocated factory overhead. e. Factory overhead applied.

a

A time ticket relates to which of the following costs? a. Direct materials costs. b. Direct labor costs. c. Indirect labor costs. d. Indirect materials costs. e. Overhead costs.

b

Dye Company uses a job cost system and predetermines a factory overhead rate based on the amount of expected fixed costs and expected volume. At the conclusion of the fiscal year, overapplied overhead could be explained by which of the following? Option A: Actual Fixed Costs (less than expected) Actual Volume (less than expected) Option B: Actual Fixed Costs (less than expected) Actual Volume (more than expected) Option C: Actual Fixed Costs (more than expected) Actual Volume (more than expected) Option D: Actual Fixed Costs (more than expected) Actual Volume (less than expected) a. Option A b. Option B c. Option C d. Option D

b

Electric Car Company listed the following data for the current year: Budgeted factory overhead $1,044,000 Budgeted direct labor hours 69,600 Budgeted machine hours 24,000 Actual factory overhead 1,037,400 Actual labor hours 72,600 Actual machine hours 23,600 Assuming Electric Car Company applied overhead based on direct labor hours, the company's predetermined overhead rate for the year is: a. $14.00 per direct labor hour. b. $15.00 per direct labor hour. c. $14.28 per direct labor hour. d. $43.95 per direct labor hour. e. $15.50 per direct labor hour.

b

Electric Car Company listed the following data for the current year: Budgeted factory overhead $1,044,000 Budgeted direct labor hours 69,600 Budgeted machine hours 24,000 Actual factory overhead 1,037,400 Actual labor hours 72,600 Actual machine hours 23,600 If overhead is applied based on machine hours, the overapplied/underapplied overhead is: a. $10,800 overapplied. b. $10,800 underapplied. c. $15,300 overapplied. d. $15,300 underapplied. e. $0.

b

Sutherland Company listed the following data for the current year: Budgeted factory overhead $2,214,000 Budgeted direct labor hours 90,000 Budgeted machine hours 45,000 Actual factory overhead 2,201,700 Actual direct labor hours 84,400 Actual machine hours 49,600 Assuming Sutherland applied overhead based on machine hours, the company's predetermined overhead rate for the current year rounded to two decimal places is: a. $43.28 per machine hour. b. $49.20 per machine hour. c. $32.61 per machine hour. d. $40.10 per machine hour. e. $52.00 per machine hour.

b

Which one of the following is the amount of factory overhead applied that exceeds the actual factory overhead cost? a. Factory overhead applied. b. Overapplied overhead. c. Underapplied overhead. d. Actual factory overhead. e. Allocated factory overhead.

b

Sutherland Company listed the following data for the current year: Budgeted factory overhead $2,100,000 Budgeted direct labor hours 89,000 Budgeted machine hours 51,000 Actual factory overhead 2,201,000 Actual direct labor hours 83,700 Actual machine hours 48,900 If overhead is applied based on direct labor hours, the overapplied/underapplied overhead is: a. $256,312 overapplied. b. $214,376 underapplied. c. $225,680 underapplied. d. $256,312 underapplied. e. $214,376 overapplied.

c

The total cost of direct materials, direct labor, and factory overhead transferred from the Work-in-Process Inventory account to the Finished Goods Inventory account during an accounting period is: a. Normal cost of goods sold. b. Total manufacturing cost. c. Cost of goods manufactured. d. Adjusted cost of goods sold. e. Actual cost of goods sold.

c

Blue Sky Incorporated listed the following data for the current year: Budgeted factory overhead $ 1,197,000 Budgeted direct labor hours 70,000 Budgeted machine hours 42,000 Actual factory overhead 1,200,000 Actual direct labor hours 87,900 Actual machine hours 41,000 Assuming Blue Sky Incorporated applied overhead based on machine hours, the firm's predetermined overhead rate for the current year rounded to 2 decimal places is: a. $29.18 per machine hour. b. $30.54 per machine hour. c. $33.25 per machine hour. d. $28.50 per machine hour. e. $34.87 per machine hour.

d

The system where the cost of a product or service is obtained by assigning costs to masses of similar units in each department and then computing unit cost on an average basis is called: a. An inventory materials control system. b. None of these answers are correct. c. An activity-based costing system. d. A process costing system. e. A job costing system.

d

Chris Fly, owner of Falcon Aircraft Company, is preparing the accounting record for the year just ended. During the year, he had projected that the company would produce 300 Falcon Aircraft for its clients with a factory overhead cost of $150,000,000. However, business was better than expected and the company was able to produce 400 aircraft at factory overhead cost of $175,000,000. What is the amount per unit that Falcon Aircraft has over- or underapplied factory overhead? a. None of these answer choices are correct. b. $125,000 overapplied. c. $62,500 underapplied. d. $125,000 underapplied. e. $62,500 overapplied.

e

Chris Fly, owner of Falcon Aircraft Company, is preparing the accounting record for the year just ended. During the year, he had projected that the company would produce 420 Falcon Aircraft for its clients with a factory overhead cost of $220,080,000. However, business was better than expected and the company was able to produce 520 aircraft at factory overhead cost of $236,236,000. What is the amount per unit that Falcon Aircraft has over- or underapplied factory overhead? a. $69,700 underapplied. b. $139,400 overapplied. c. $139,400 underapplied. d. None of these answer choices are correct. e. $69,700 overapplied

e

Solar World Incorporated is a job-order manufacturer. The company uses a predetermined overhead rate based on direct labor hours to apply overhead to individual jobs. For the current year, estimated direct labor hours are 133,000 and estimated factory overhead is $784,700. The following information is for September. Job X was completed during September, while Job Y was started but not finished. September 1, inventories: Materials $24,000 Work-in-process (All Job X) 53,400 Finished goods 105,600 Materials purchases $157,000 Direct materials requisitioned: Job X $74,000 Job Y 68,000 Direct labor hours: Job X 7,000 Job Y 5,500 Labor costs incurred: Direct labor ($6.00 per hour) $75,000 Indirect labor 24,200 Factory supervisory salaries 11,100 Rental costs: Factory $9,300 Administrative offices 3,200 Total equipment depreciation costs: Factory$10,400 Administrative offices 2,800 Indirect materials used $17,800 The total ending work-in-process for September is: a. $101,000. b. $68,000. c. $53,400. d. $157,300. e. $133,450.

e

The predetermined factory overhead rate includes: a. Estimated electricity consumed. b. Estimated direct labor costs. c. Estimated total cost. d. Estimated annual sales. e. Estimated total amount of cost driver.

e