ACCT CH 1-4 REVIEW QUESTIONS
A company's overhead rate is 60% of direct labor cost. Using the following incomplete accounts, determine the cost of direct materials used: Goods in process inventory: Beginning Balance: |. FG ? 100800. | Direct Materials ? | Direct Labor ? | Overhead ? | Ending Balance | 131,040 | Finished Goods Inventory Debits: | Credits: 118200 | 301000 324800 | Ending | Balance: | 142000. | Factory Overhead Debits | Credits: 93240 | 90720 $106,400 $113,120 $30,240 $211,680 $324,800
$113,120 (DL= Ovhd/pdr: 90720/60% = 151200) (DM= Ending WIP + Finished Goods - Beginning WIP - DR - Ovhd: 131040 + 324800 - 100800 - 151200 - 90720 = 113120)
During last period, a company's overhead rate was 150% of direct labor cost. This caused factory overhead to be $10,000 overapplied. Use the following incomplete accounts to determine the cost of goods sold: Goods in process inventory Beginning Balance: | COGM ? 10000. | DM 80000 | DL ? | OH | Ending Balance | 20000 | Finished Goods Inventory Beginning balance 30000 | ? | ? Ending Balance 70000 | Factory Overhead 50000 | $130,000 $170,000 $40,000 $60,000 $90,000
$130,000 (applied OH: 60000 b/c 10000 overapplied) (COGM: 10000 + 80000 + 40000 + 60000 - 20000 = 170000) (COGS: 30000 + 170000 - 70000 = 130000)
Use the following information to compute the cost of goods manufactured: Beginning finished goods inventory: $9250 Beginning goods in process inventory: $8700 Beginning raw materials: $7500 Depreciation on factory equipment: $6000 Direct Labor: $75000 Ending finished goods inventory: $8750 Ending goods in process inventory: $9300 Ending raw materials: $8500 Factory Supervisor's salary: $50000 Raw materials purchases: $14000 $143,400 $13,000 $143,000 $144,500 $93,400
$143,400 (BEGINNING WORK IN PROGRESS: $8700 Raw Materials: Beginning Raw Materials: $7500 Raw Materials Purchased: $14000 Ending Raw Materials: ($8500) TOTAL RAW MATERIALS - $13000 DIRECT LABOR - $75000 Man Overhead: Depreciation on factory equipment: $6000 Factory Supervisor Salary: $50000 TOTAL MANUFACTURING COST - $56000 LESS: ENDING WORK IN PROGRESS - ($9300) COGM - $143400) (beginning work in progress + total raw materials + direct labor + total manufacturing cost - ending work in progress = COGM: 8700 + 13000 + 75000 + 56000 - 9300 = 143400)
During last period, a company's overhead rate was 150% of direct labor cost. This caused factory overhead to be $10,000 overapplied. Use the following incomplete accounts to determine the cost of goods manufactured: Goods in process inventory Beginning Balance: | COGM ? 10000. | DM 80000 | DL ? | OH | Ending Balance | 20000 | Finished Goods Inventory Beginning balance 30000 | ? | ? Ending Balance 70000 | Factory Overhead 50000 | $130,000 $170,000 $40,000 $60,000 $90,000
$170,000 (applied OH: 60000 b/c 10000 overapplied) (COGM: 10000 + 80000 + 40000 + 60000 - 20000 = 170000)
A company estimates that overhead costs for the next year will be $9,234,000 for indirect labor and $156,800 for factory utilities. The company uses machine hours as its overhead allocation base. If 500,000 machine hours are planned for this next year, what is the company's plantwide overhead rate? (Round to two decimal places) $0.05 per machine hour. $18.47 per machine hour. $18.78 per machine hour. $0.31 per machine hour. $3.19 per machine hour.
$18.78 per machine hour ((9234000 + 156800)/500000)
Heritage Industries produces miniature models of farm equipment. These collectibles are in great demand. It takes two operations, molding and finishing, to complete the miniatures. Next year's expected activities are shown in the following table: Molding: Direct Labor Hours: 65000 DLH Machine Hours: 97500 MH Finishing: Direct Labor Hours: 162500 DLH Machine Hours: 81250 MH Heritage Industries uses departmental overhead rates and is planning on a $3.20 per machine hour overhead rate for the finishing department. Compute the estimated manufacturing overhead cost for the finishing department given the information shown in the table. $208,000 $312,000 $520,000 $260,000 $572,000
$260,000 (81250 x $3.20 = $260000)
The following data relates to Lead Company's estimated amounts for next year. Department 1: Manufacturing Overhead costs: $1200000 Direct Labor Hours: 560000 DLH Machine Hours: 91000 MH Department 2: Manufacturing Overhead costs: $3400000 Direct Labor Hours: 780000 DLH Machine Hours: 23000 MH What is the company's plantwide overhead rate if direct labor hours are the allocation base?(Round to two decimal places) $3.43 per direct labor hour. $2.14 per direct labor hour. $4.36 per direct labor hour. $.29 per direct labor hour. $.47 per direct labor hour.
$3.43 per direct labor hour ((1200000 + 3400000)/(560000 + 780000))
During last period, a company's direct labor cost was double the cost of its direct material used. In addition, factory overhead was $5,000 underapplied. Use the following incomplete accounts to determine the cost of direct labor: Goods in process inventory Beginning Balance: | FG ? 60000 | DM ? | DL ? | OH | Ending Balance | 87000. | Finished Goods Inventory Beginning balance 76000 | ? | 93000 Ending Balance 71000 | Factory Overhead 75000 | $15,000 $88,000 $45,000 $70,000 $30,000
$30,000 (applied overhead: 70000 bc actual overhead is undersupplied by $5000) (FG: 71000 = 76000 + x -93000 which equals 88000) (DM: 87000 = 60000 + 2x + x + 70000 - 88000. x = 15000) (DL = 2x = 30000)
Use the following information for Acme, Inc., as of December 31 What is the correct amount of cost of goods manufactured? Administrative salaries: $32000 Depreciation of Factory equipment:: $25000 Depreciation of Delivery vehicles: $9000 Direct Labor: $68000 Factory Supplies Used: $12000 Finished Goods inventory, January 1: $57000 Finished Goods inventory, December 31: $68000 Factory Insurance: $15500 Interest Expense: $12000 Factory Utilities: $14000 Factory Maintenance: $7500 Raw Materials inventory, January 1: $8000 Raw Materials inventory, December 31: $4000 Raw materials purchases: $125000 Rent on factory building: $25000 Repairs of factory equipment: $11500 Sales commissions: $37500 Goods in Process inventory, January 1: $3500 Goods in Process inventory, December 31: $2000 $398,500. $386,000. $309,000. $306,000. $296,500.
$309,000. (BEGINNING WORK IN PROGRESS - 3500 Raw material consumed: Beginning raw material 8000 raw material purchased 125000 Ending raw material (4000) TOTAL RAW MATERIALS - 129000 DIRECT LABOR - 68000 Manufacturing overhead: depreciation factory equipment 25000 Factory supplies used 12000 Factory insurance 15500 Factory utilities 14000 Factory maintenance 7500 Rent on factory building 25000 Repairs of factory equipment 11500 TOTAL MANUFACTURING COST - 110500 LESS: ENDING WORK IN PROGRESS - (2000) COGM - 309000) (beginning work in progress + total raw materials + direct labor + total manufacturing cost - ending work in progress = COGM: 3500 + 129000 + 68000 + 110500 - 2000 = 309000)
Use the following information to compute the cost of goods sold for the period: Beginning Raw Materials: $5500 Ending Raw Materials: $4000 Direct Labor: $12250 Raw Materials Purchases: $7400 Depreciation on factory equipment: $6500 Factory Repairs and maintenance: $3300 Beginning finished goods inventory: $10200 Ending finished goods inventory: $8900 Beginning finished goods in process inventory: $5700 Ending finished goods in process inventory: $6300 $36,650 $30,950 $30,650 $30,350 $31,650
$31,650 ((5500+12250+7400+6500+3300+10200+5700)-(4000+8900+6300) = 31650) ((Beginning Raw Materials + Direct Labor + Raw Materials Purchases + Depreciation on factory equipment + Factory Repairs and maintenance + Beginning finished goods inventory + Beginning finished goods in process inventory) - (Ending Raw Materials + Ending finished goods inventory + Ending finished goods in process inventory) = COGS)
Thomas Company has total fixed costs of $360,000 and variable costs of $14 per unit. If the unit sales price is reduced from $24 to $20 and advertising is increased by $10,000, sales will increase from 40,000 to 65,000 units.What are the contribution margin and net income under the revised conditions? $650,000 and $280,000 respectively. $400,000 and $40,000 respectively. $280,000 and $40,000 respectively. $390,000 and $20,000 respectively. $400,000 and $20,000 respectively.
$390,000 and $20,000 respectively. ($20x65000 = 1300000 $14x65000 = 910000 130000 - 910000 = $390000) (1300000 - 910000 - 360000 - 10000 = 20000)
A manufacturing company uses a job order cost accounting system. Overhead is applied using pounds of direct materials used as an allocation base. Total costs for a particular job were $5,720. Of this amount $2,600 was direct labor and $1,040 was direct material. The company pays $26 per hour of direct labor and $2 per pound of direct materials. What is this company's overhead rate? $2 per pound of direct material used. $1,040 per pound of direct material used. $520 per pound of direct material used. $4 per pound of direct material used. $2,080 per pound of direct material used.
$4 per pound of direct material used. ($5720- $2600- $1040 = $2080 for ovhd) ($1040/$2 = $520) (Answer: $2080/$520= $4)
The ending inventory of finished goods has a total cost of $10,000 and consists of 500 units. If the overhead applied to these goods is $2,000, and the overhead rate is 50% of direct labor, how much direct materials cost was incurred in producing these units? $4,000 $6,000 $3,000 $7,000 $10,000
$4,000 (Direct Materials: 2000x2 = 4000 Direct Labor: 2000 Man Ovhd: 10000-4000-2000 = 4000 )
Wall Nuts, Inc. produces paneling that requires two processes, A and B, to complete. Oak is the best-selling of all the many types of paneling produced. Information related to the 40,000 units of oak paneling produced annually is shown in the following table: Direct materials: $380,000 Direct labor: Department A (6,000 DLH × $25 per DLH) $150,000 Department B (35,125 DLH × $16 per DLH) $562,000 Machine Hours: Department A 24,000 MH Department B 32,000 MH Wall Nuts' total expected overhead costs and related overhead data are shown below. Department A: Direct Labor hours: 67000 DLH Machine Hours: 100000 MH Manufacturing Overhead Costs: $450000 Department B: Direct Labor hours: 170000 DLH Machine Hours: 80000 MH Manufacturing Overhead Costs: $600000 Use the data for Wall Nuts, Inc. to compute departmental overhead rates based on machine hours in Department A and machine hours in Department B. $4.50 per MH in Dept A; $4.50 per MH in Dept B. $7.50 per MH in Dept A; $7.50 per MH in Dept. B. $4.50 per MH in Dept A; $7.50 per MH in Dept B. $2.70 per MH in Dept A; $6.00 per MH in Dept B. $0.60 per MH in Dept A; $0.80 per MH in Dept B.
$4.50 per MH in Dept A; $7.50 per MH in Dept B. (A: 450000/100000 = 4.50) (B: 600000/80000 = 7.50)
K Company estimates that overhead costs for the next year will be $2,900,000 for indirect labor and $800,000 for factory utilities. The company uses direct labor hours as its overhead allocation base. If 80,000 direct labor hours are planned for this next year, what is the company's plantwide overhead rate? $.02 per direct labor hour. $46.25 per direct labor hour. $36.25 per direct labor hour. $10 per direct labor hour. $.10 per direct labor hour.
$46.25 per direct labor hour. ((2900000 + 800000/80000))
The following costs are included in a recent summary of data for a company: advertising expense, $85,000; depreciation expense - factory building, $133,000; direct labor, $250,000; direct material used, $300,000; factory utilities, $105,000; and sales salaries expense, $150,000. Determine the dollar amount of conversion costs. $1,023,000 $550,000 $488,000 $235,000 $238,000
$488,000 (Direct Labor + Man Ovhd (depreciation expense factory building and factory utilities): 250000 + 133000 + 105000 = 488000)
Juliet Corporation has accumulated the following accounting data for the year: The cost of goods manufactured for the year is: Finished Goods Inventory, January 1: $3200 Finished Goods Inventory, December 31: $4000 Total Costs of Goods Sold: $4200 $200 $1,000 $5,000 $6,400 $8,200
$5,000 (4000 + 4200 - 3200 = 5000)
The following costs are included in a recent summary of data for a company: advertising expense, $85,000; depreciation expense - factory building, $133,000; direct labor, $250,000; direct material used, $300,000; factory utilities, $105,000; and sales salaries expense, $150,000. Determine the dollar amount of prime costs. $1,023,000 $550,000 $488,000 $235,000 $238,000
$550,000 (Direct Materials + Direct Costs: 250000 + 300000 = 550000)
The Goods in Process Inventory Account for XYZ Inc. follows: Beginning balance: 4750 Direct materials: 17925 Direct labor: 24750 Applied overhead: ? Ending balance: 10400 Finished Goods ? If the overhead is applied at the rate of 80% of direct labor cost, what is the amount of Cost of Goods Manufactured? $19,800 $56,825 $61,775 $51,365 $37,025
$56,825
The Goods in Process Inventory account for the AB Corp. follows: Beginning balance: 4500 Direct materials: 47100 Direct labor: 29600 Applied overhead: 15800 Ending balance: 8900 Finished Goods ? The cost of units transferred to finished goods is: $97,000 $105,900 $88,100 $95,200 $92,500
$88,100 (4500 + 47100 + 29600 + 15800 - 8900 = 88100)
Lake Prairie Company uses a plantwide overhead rate with machine hours as the allocation base. Next year, 500,000 units are expected to be produced taking .75 machine hours each. How much overhead will be assigned to each unit produced given the following estimated amounts? Department 1: Manufacturing Overhead costs: $3107500 Direct Labor Hours: 150000 DLH Machine Hours: 200000 MH Department 2: Manufacturing Overhead costs: $1520000 Direct Labor Hours: 200000 DLH Machine Hours: 175000 MH $12.34 per unit $7.77 per unit $9.25 per unit $15.20 per unit $10.36 per unit
$9.25 per unit (predetermined Overhead rate: (3107500 + 1520000)/(200000 + 175000) = 12.34) (Overhead rate per unit: 12.34 x .75 MH)
Ajax Company accumulated the following account information for the year: Beginning raw materials inventory: $6000 Indirect materials cost: $2000 Indirect labor cost: $5000 Maintenance of factory equipment: $2800 Direct labor cost: $7000 Using the above information, total factory overhead costs would be: $9,800 $16,800 $15,800 $13,000
$9800 (2000 + 5000 + 2800 = 9800) (indirect materials cost + indirect labor costs + maintenance of factory equipment = total manufacturing overhead costs)
O.K. Company uses a job order cost accounting system and allocates its overhead on the basis of direct labor costs. O.K. expects to incur $800,000 of overhead during the next period and expects to use 50,000 labor hours at a cost of $10.00 per hour. What is O.K. Company's overhead application rate? 6.25% 62.5% 160% 1600% 67%
160% (800000/50000 x 100)
Yellow Company uses a plantwide overhead rate with machine hours as the allocation base. Use the following information to solve for the amount of machine hours estimated per unit of product RST. Direct material cost per unit of RST $12 Total estimated manufacturing overhead: $200000 Total cost per unit of RST $75 Total cost per unit of RST: 100000 MH Direct labor cost per unit of RST: $23 40 MH per unit of RST. 2 MH per unit of RST. 20 MH per unit of RST. 37.5 MH per unit of RST. 80 MH per unit of RST.
20 MH per unit of RST ($200000/100000 MH = $2 per MH) ($75 = $12 + $23 + OH = $40) ($40/$2 = $20 per unit of RST)
Canoe Company's manufacturing accounting system uses direct labor costs to apply overhead to goods in process and finished goods inventories. Canoe Company's manufacturing costs for the year were: direct labor, $30,000; direct materials, $50,000; and factory overhead applied, $6,000. The overhead application rate was: 5.0% 12.0% 20.0% 500.0% 16.7%
20.0% (6000/30000 x 100)
Case Company allocates $5.00 overhead to each unit produced. The company uses a plantwide overhead rate with machine hours as the allocation base. Given the amounts below, how many machine hours does the company expect in department 2? Department 1: Manufacturing Overhead costs: $250000 Direct Labor Hours: 8000 DLH Machine Hours: 55000 MH Department 2: Manufacturing Overhead costs: $150000 Direct Labor Hours: 12000 DLH Machine Hours: ? MH 25,000 MH 137,500 MH 82,500 MH 88,000 MH 33,000 MH
25,000 MH ((250000 + 150000)/(55000 + x) = 5) (400000 = 5x + 275000)
An opportunity cost is: An uncontrollable cost. A cost of potential benefit lost. A change in the cost of a component. A direct cost.A sunk cost.
A cost of potential benefit lost.
Overhead is applied as a percent of direct labor costs. Estimated overhead and direct labor costs for the year were $112,500 and $125,000, respectively. During the year, actual overhead was $107,400 and actual direct labor cost was $120,000. The entry to close the over - or underapplied overhead at year-end, assuming an immaterial amount, would include: A debit to Cost of Goods Sold for $600. A credit to Factory Overhead for $600. A credit to Finished Goods Inventory for $600. A debit to Goods in Process Inventory for $600. A credit to Cost of Goods Sold for $600.
A credit to Cost of Goods Sold for $600.
Overhead is applied as a percent of direct labor costs. Estimated overhead and direct labor costs for the year were $250,000 and $125,000, respectively. During the year, actual overhead was $248,000 and actual direct labor cost was $123,000. The entry to close the over - or underapplied overhead at year-end, assuming an immaterial amount, would include: A debit to Cost of Goods Sold for $2,000. A debit to Factory Overhead for $2,000. A credit to Finished Goods Inventory for $2,000. A debit to Goods in Process Inventory for $2,000. A credit to Cost of Goods Sold for $2,000.
A debit to Cost of Goods Sold for $2,000.
From an ABC perspective, what causes costs to be incurred? Financial transactions. The volume of units produced. Debits and credits. Management decisions. Activities.
Activities
The Dina Corp. has applied overhead to jobs during the period as follows: The application of overhead has resulted in a $5,600 credit balance in the Factory Overhead account, and this amount is not material. The entry to dispose of this remaining factory overhead balance is: A. Dr COGS 5600 Cr factory ovhd 5600 B. Dr factory Ovhd 5600 Cr COGS 5600 C. Dr Factory Ovhs 5600 Cr Goods in Process 5600 D. Dr Goods in Process 5600 Cr Factory Ovhd 5600 E. No entry needed
B. Dr factory Ovhd 5600 Cr COGS 5600
Penn Company uses a job order cost accounting system. In the last month, the system accumulated labor time tickets totaling $24,600 for direct labor and $4,300 for indirect labor. These costs were accumulated in Factory Payroll as they were paid. Which entry should Penn make to assign the Factory Payroll? A. Dr payroll expense 28900 Cr Cash 28900 B. Dr Payroll Expense 24600 Dr Factory Overhead 4300 Cr Factory Payroll 28900 C. Dr Goods in process inventory 24600 Dr Factory Overhead 4300 Cr Factory Payroll 28900 D. Dr Goods in process inventory 24600 Dr Factory overhead 4300 Cr Accrued wages payable 28900 E. Dr goods in process inventory 28900 Cr factory payroll 28900
C. Dr Goods in process inventory 24600 Dr Factory Overhead 4300 Cr Factory Payroll 28900
A job order cost accounting system would best fit the needs of a company that makes: Shoes and apparel. Paint. Cement. Custom machinery. Pencils and erasers.
Custom machinery.
Aurora Corporation produces outdoor security lighting products. All products go through three processes before completion. Use the expected overhead costs and related data shown below to compute departmental overhead rates based on machine hours in Department A1A; based on direct labor hours in Department B2B; and machine hours in Department C3C. Department A1A: Direct Labor Hours: 90000 DLH Machine Hours: 54000 MH Manufacturing overhead costs: $540000 Department B2B: Direct Labor Hours: 80000 DLH Machine Hours: 32000 MH Manufacturing overhead costs: $160000 Department C3C: Direct Labor Hours: 72000 DLH Machine Hours: 54000 MH Manufacturing overhead costs: $216000 Dept. A: $10 per MH; Dept B: $2 per DLH; Dept C: $4 per MH. Dept. A: $6 per MH; Dept B: $5 per DLH; Dept C: $3 per MH. Dept. A: $10 per MH; Dept B: $5 per DLH; Dept C: $4 per MH. Dept. A: $6 per MH; Dept B: $5 per DLH; Dept C: $4 per MH. Dept. A: $10 per MH; Dept B: $2 per DLH; Dept C: $3 per MH.
Dept. A: $10 per MH; Dept B: $2 per DLH; Dept C: $4 per MH. (A1A: 540000/54000 = 10) (B2B: 160000/80000 = 2) (C3C: 216000/54000 = 4)
Labor costs that are clearly associated with specific units or batches of product because the labor is used to convert raw materials into finished products called are: Sunk labor. Direct labor. Indirect labor. Finished labor. Supervisory labor.
Direct labor.
Labor costs in manufacturing can be: Direct or indirect. Indirect or sunk. Direct or payroll. Indirect or payroll. Direct or sunk.
Direct or indirect.
A fixed cost: Requires the future outlay of cash and is relevant for future decision making. Does not change with changes in the volume of activity within the relevant range. Is directly traceable to a cost object. Changes with changes in the volume of activity within the relevant range. Has already been incurred and cannot be avoided so it is irrelevant for decision making.
Does not change with changes in the volume of activity within the relevant range.
Costs that are incurred as part of the manufacturing process but are not clearly associated with specific units of product or batches of production, including all manufacturing costs other than direct material and direct labor costs, are called: Administrative expenses. Nonmanufacturing costs. Sunk costs. Factory overhead. Preproduction costs.
Factory overhead.
A cost that remains the same in total even when volume of activity varies is a: Fixed cost. Curvilinear cost. Variable cost. Step-wise variable cost. Standard cost.
Fixed cost
When factory payroll costs are recorded in a job cost accounting system: Factory Payroll is debited and Goods in Process is credited. Goods in Process Inventory and Factory Overhead are debited and Factory Payroll is credited. Cost of Goods Manufactured is debited and Direct Labor is credited. Direct Labor and Indirect Labor are debited and Factory Payroll is credited. Goods in Process is debited and factory payroll is credited.
Goods in Process Inventory and Factory Overhead are debited and Factory Payroll is credited.
The overhead cost applied to a job during a period is recorded with a credit to Factory Overhead and a debit to: Jobs Overhead Expense. Cost of Goods Sold. Finished Goods Inventory. Indirect Labor. Goods in Process Inventory.
Goods in Process Inventory.
When raw materials are used in production and are recorded in a job cost system: Goods in Process is credited and Finished Goods is debited. Direct Material and Indirect Material are debited and Goods in Process is credited. Direct Material and Indirect Material are debited and Raw Materials Inventory is credited. Goods in Process is debited and Raw Materials Inventory is credited. Goods in Process and Factory Overhead are debited and Raw Materials Inventory is credited
Goods in Process and Factory Overhead are debited and Raw Materials Inventory is credited
Products that are in the process of being manufactured but are not yet complete are called: Raw materials inventory. Conversion costs. Cost of goods sold. Goods in process inventory. Finished goods inventory.
Goods in process inventory.
Classifying costs by behavior involves: Identifying fixed cost and variable cost. Identifying cost of goods sold and operating costs. Identifying all costs.Identifying costs in a physical manner. Identifying both quantitative and qualitative cost factors.
Identifying fixed cost and variable cost.
The cost of labor that is not clearly associated with specific units or batches of product is called: Unspecified labor. Direct labor .Indirect labor. Basic labor. Joint labor.
Indirect labor
The salary paid to the supervisor of an assembly line would normally be classified as: Direct labor. Indirect labor A period cost. A general cost. An assembly cost.
Indirect labor
Materials that are used in support of the production process but that do not become a part of the product and are not clearly identified with units or batches of product are called: Secondary materials. General materials. Direct materials. Indirect materials Materials inventory.
Indirect materials
Which of the following costs would not be classified as factory overhead? Property taxes on maintenance machinery. Expired insurance on factory equipment. Wages of the factory janitor. Metal doorknobs used on wood cabinets produced. Small tools used in production.
Metal doorknobs used on wood cabinets produced.
A cost that can be separated into fixed and variable components is called a: Mixed cost Step-variable cost. Composite cost. Curvilinear cost.
Mixed cost
Which of the following is never included in direct materials costs? Invoice costs of direct materials. Outgoing delivery charges. Materials storage costs. Materials handling costs. Insurance on stored material.
Outgoing delivery charges.
Costs that are first assigned to inventory are called: Period costs. Product costs. General costs. Administrative costs. Fixed costs.
Product costs.
A company's normal operating range, which excludes extremely high and low volumes that are not likely to occur, is called the: Margin of safety. Contribution range. Break-even point. Relevant range. High-low point.
Relevant range.
Factory overhead costs normally include all of the following except: Indirect labor costs. Indirect material costs. Selling costs. Factory machinery oil. Factory rent.
Selling costs.
A job cost sheet shows information about each of the following items except: The direct labor costs assigned to the job. The name of the customer. The costs incurred by the marketing department in selling the job. The overhead costs assigned to the job. The direct materials costs assigned to the job.
The costs incurred by the marketing department in selling the job.
Period costs for a manufacturing company would flow directly to: The current income statement Factory overhead. The current balance sheet. Job cost sheet. The current manufacturing statement.
The current income statement
Which one of the following statements is not true? Total fixed costs remain the same regardless of volume. Total variable costs change with volume. Total variable costs decrease as the volume increases. Fixed costs per unit increase as the volume decreases. Variable costs per unit remain the same regardless of the volume.
Total variable costs decrease as the volume increases.
A direct cost is a cost that is: Identifiable as controllable. Recorded as part of manufacturing overhead. Fixed with respect to the volume of activity. Traceable to a cost object. Sunk with respect to a cost object.
Traceable to a cost object.
If overhead applied is less than actual overhead, it is: Fully applied. Underapplied. Overapplied. Expected. Normal.
Underapplied.
A cost that changes in total proportionately to changes in volume of activity is a(n): Differential cost. Fixed cost Incremental cost. Variable cost. Product cost.
Variable cost
