ACCT 202 - (Chapter 3 - Connect)

Job #4260 consisted of 1,000 units at a total of $200,000. The cost transferred to Cost of Goods Sold for the sale of 600 of the units is:

$120,000

Which of the statements regarding closing out over or underapplied overhead is correct?

Closing to COGS is simpler, and allocating is more accurate.

Applied manufacturing overhead will most likely __________ actual manufacturing overhead.

NOT equal

Any purchased materials that will go into the finished product are first recorded in the ___________ ___________________ inventory account.

Raw Materials

Manufacturing overhead is applied with a debit to:

Work in process

When a job is completed, which account is credited?

Work in process

The journal entry to record $10,000 in manufacturing overhead applied to Job #40 debits:

Work in process $10,000 and credits Manufacturing overhead $10,000

Overhead is overapplied if:

actual overhead is less than applied overhead

The more accurate method of closing out the balance in the Manufacturing overhead is:

allocating it among Work in process, Finished goods, and COGS

The journal entry to record general selling and administrative costs debits:

an expense account and credit Cash or a liability

A journal entry that debits Work in process and credits Manufacturing overhead is recording the:

application of manufacturing overhead costs

Raw materials inventory is an:

asset account

A journal entry that debits Finished Goods and credits Work in process records the:

completion of a job

Finished goods:

consists of completed, unsold goods

When overhead is underapplied, a _______ must be made to the Manufacturing overhead account to close it out.

credit

Difference b/n the entries to record depreciation on office equipment and depreciation on factory equipment is that one:

debits Depreciation expense, while the other debits Manufacturing overhead

A journal entry that debits Manufacturing overhead and credits Accounts payable could NOT record incurrence of:

direct labor costs (the incurrence of direct labor costs should be recorded by debiting Work in process account.)

The cost of jobs still unfinished at the end of a period are included in:

ending Work in process inventory

The formula for a predetermined overhead rate is:

estimated manufacturing overhead cost divided by estimated allocation base

When labor costs are incurred, ______________ are added to the Work in Progress account.

only direct labor costs

The difference b/n overhead applied work in process and actual overhead is:

overapplied or underapplied overhead

What methods can be used to dispose of underapplied or overapplied manufacturing overhead?

-closing it out to COGS -Allocating it among Work in process, finished goods, and COGS

The _________ (debit/credit) side of the manufacturing overhead account is always used to record manufacturing overhead applied to production and the _____________ (debit/credit) side is always used to record the actual manufacturing overhead incurred.

-credit -debit

Which of the following would be classified as manufacturing overhead? -Marketing costs -Factory utilities -Factory maintenance wages -Assembly wages -Factory rent

-Factory utilities -Factory maintenance wages -Factory rent

Is actual manufacturing overhead debited or credited to the Manufacturing overhead account?

Debited

When jobs are sold their costs are transferred out of:

Finished Goods

When a job is complete, which account is debited?

Finished goods

The value of work in process is equal to:

the cost of all unfinished jobs

What side of the Manufacturing overhead account is actual manufacturing overhead is entered on?

Always the debit side

Which account is credited when manufacturing overhead is applied?

Manufacturing overhead

Cost of goods manufactured:

includes the manufacturing cost of goods finished during the period

Which of the following is a clearing account? -Manufacturing overhead -Raw materials -Work in process -Finished goods

-manufacturing overhead

Actual overhead costs may not be proportional to the actual amount of the allocation base used bc:

-many actual overhead costs are fixed -overhead spending may not be under control

The journal entry to record a cash payment of $400 for insurance on administrative office equipment debits __________ and credits cash.

insurance expense

Units of product that are only partially complete are contained in the _____________-_____-______________ inventory.

work-in-progress