SB 2

When materials are purchased they are first recorded in the ______ account.

Raw Materials Inventory

Applied manufacturing overhead costs are credited to the Manufacturing Overhead account ______.

as the costs are applied to jobs

The cost of goods ___ report summarizes the flow of manufacturing costs from Raw Materials to Work in Process Inventory and into Finished Goods.

manufactured

Nonmanufacturing costs incurred during a period are treated as ______.

period expenses

Overhead costs are debited to Work in Process when ______.

they are applied to jobs

Costs are transferred out of Finished Goods inventory ______.

when goods are sold

Nonmanufacturing costs increase ______.

the Selling, General & Administrative expense accounts

Given the following, calculate total current manufacturing costs: Direct materials: $40,000; Direct labor: $100,000 Manufacturing overhead applied: $120,000 Beginning Work in process inventory: $30,000 Ending Work in process inventory: $12,000

$260,000 Rationale: Total manufacturing costs = $40,000 + $100,000 + $120,000 = $260,000

Raw materials inventory was $27,000 at the beginning of the year and $25,000 at the end of the year. During the year, $100,000 in raw materials were purchased, including $28,000 of indirect materials that were put into manufacturing overhead during the period. Calculate the cost of direct materials used during the period.

$74,000 Rationale: Cost of direct materials = Beginning Inventory + Purchases - Indirect Materials - Ending Inventory ($27,000 + $100,000 - $28,000 - $25,000 = $74,000)

When is the predetermined overhead rate calculated?

Before the period begins

The first step in assigning manufacturing overhead costs using a predetermined overhead rate is to ______.

determine the cost driver

To calculate direct materials on the schedule of cost of goods manufactured, add purchases to beginning raw materials inventory and subtract ______.

ending raw materials inventory and indirect materials used

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

Finished Goods

Which of the following items are included on a cost of goods manufactured report?

Beginning and ending raw materials inventory Applied manufacturing overhead Beginning and ending work in process inventory