managerial acct 3

normal cost system

an approach that assigns the actual costs of direct materials and direct labor to products but uses a predetermined rate to assign overhead costs

_______ is found by multiplying the predetermined overhead rate by the actual use of the associated activity for the period

applied overhead

overhead assigned to production using predetermined rates is

applied overhead

the ______ is subsidiary to the work-in-process account and is the primary document for accumulating all costs related to a particular job.

job-order cost sheet

A _______ is used by the cost accounting department to enter the cost of direct materials onto the correct job-order cost sheet.

materials requisition form

This form asks for the type, quantity, and unit price of direct materials.

materials requisition form

This form may be used to maintain proper control over a firm's inventory of direct materials

materials requisition form

The amount by which applied overhead exceeds actual overhead

overapplied overhead

The difference between actual overhead and applied overhead

overhead variance

The difference between actual overhead and applied overhead is called a (n)

overhead variance

A ___________ is a single overhead rate calculated by using all estimated overhead for a factory divided by the estimated activity level across the entire factory.

plantwide overhead rate

A single overhead rate calculated using all estimated overhead for a factory divided by the estimated activity level across the entire factory

plantwide overhead rate

The _________ is calculated at the beginning of the year by dividing the total estimated annual overhead by the total estimated level of cost driver.

predetermined overhead rate

an overhead rate computed using estimated data is

predetermined overhead rate

When materials are requested for production the cost is removed from ________ and added to______

raw materials; work-in-process

A source document by which direct labor costs are assigned to individual jobs is known as a

time ticket

This form is filled out by each employee every day.

time ticket

If actual overhead is greater than applied overhead, then the variance is called

underapplied overhead

the amount by which actual overhead exceeds applied over head is

underapplied overhead

A normal job-order costing system is a system that uses:

Actual costs for direct materials and direct labor and estimated costs for overhead.

Using normal costing, which costs never enter the work-in-process account?

Actual overhead

Using normal costing requires that

Actual overhead costs are not assigned directly to jobs.

Actual cost system

An approach that assigns actual costs of direct materials, direct labor and overhead to products

Estimated overhead for a single department divided by the estimated activity level for that same department

Departmental overhead rate

T/F Actual overhead costs always enter the Work-in-Process account.

F

T/F Direct labor is allocated to jobs along with overhead using a cost driver.

F

T/F There will be many different jobs on a job-order cost sheet.

F

T/F Work-in-process consists of all complete work.

F

Every time a new job is started this is prepared.

Job-order cost sheet

The job order number, or name, head this form.

Job-order cost sheet

T/F If the overhead variance shows overapplied overhead, then that amount would be subtracted from normal cost of goods sold.

T

T/F The adjusted cost of goods sold is equal to normal cost of goods sold plus or minus the overhead variance.

T

T/F The cost of a job includes direct materials, direct labor, and applied overhead.

T

T/F Time tickets are used to post the cost of direct labor to individual jobs

T

T/F Variances in overhead are expected every month.

T

T/F When a job is complete, it must leave Work-in-Process and be entered into Finished Goods or Cost of Goods Sold.

T

job-order costing system

a costing system in which costs are collected and assigned to units of production for each individual job

process-costing system

a costing system that accumulates production costs by process or by department for a given period of time

_________ is the amount that appears as an expense on the income statement after the adjustment for the period's overhead variance is recorded.

adjusted cost of goods sold