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