Managerial Accounting chp 19
The recording of the application of factory overhead costs to jobs would include a credit to
Factory Overhead
The recording of the factory labor incurred for general factory use would include a debit to
Factory Overhead
A manufacturing business reports just two types of inventory on its balance sheet: work in process inventory and finished goods inventory. Group of answer choices
False
A receiving report is prepared when purchased materials are first received by the manufacturing department.
False
Direct labor cost is an example of a period cost.
False
If factory overhead applied exceeds the actual costs, overhead is said to be underapplied.
False
Information about costs developed through a job order cost system cannot be used to evaluate an organization's cost performance.
False
The inventory accounts generally maintained by a manufacturing firm are only finished goods and materials.
False
The job order costing system is not used by service organizations.
False
The process cost system is appropriate where few products are manufactured and each product is made to customers' specifications.
False
The process cost system is appropriate where few products are manufactured and each product is made to customers' specifications. Group of answer choices
False
When goods are sold, their costs are transferred from Work in Process to Finished Goods.
False
Materials purchased on account during the month totaled $190,000. Materials requisitioned and placed in production totaled $165,000. The journal entry to record the material purchase on account is
Materials 190,000 Accounts Payable 190,000
Which of the following is the correct flow of manufacturing costs?
Raw materials, work in process, finished goods, cost of goods
A law firm would use a job order cost system to accumulate all of the costs associated with a particular client engagement, such as lawyer time, copying charges, filing fees, and overhead.
True
Cost accounting systems measure, record, and report product costs.
True
If the underapplied factory overhead amount is immaterial, it is transferred to Cost of Goods Sold at the end of the fiscal year.
True
In a job order cost accounting system for a service business, materials costs are normally included as part of overhead.
True
Materials are transferred from the storeroom to the factory in response to materials requisitions.
True
Nonmanufacturing costs are generally classified into two categories: selling and administrative.
True
The document that serves as the basis for recording direct labor on a job cost sheet is the time ticket.
True
Which of the following is the formula to calculate the predetermined factory overhead rate?
estimated total factory overhead costs divided
Each document in the cost ledger is called a
job cost sheet
Which of the following are the two main types of cost accounting systems for manufacturing operations?
job order cost and process cost systems
A widely used activity base for developing factory overhead rates in highly automated settings is
machine hours
Costs that are incurred in generating revenues during the period, but are not involved in the manufacturing process, are referred to as
product cost
In a job order cost accounting system, when goods that have been ordered are received, the receiving department personnel count the goods, inspect the goods, and complete a
receiving report
Period costs are classified as either
selling expenses or administrative expenses
The basis for recording direct and indirect labor costs incurred is a summary of the period's
time tickets
Which of the following costs are not included in finished goods inventory?
chief financial officer's salary
Job order costing and process costing are
cost accounting systems
In a job order cost accounting system, the entry to record the flow of direct materials into production is to
debit Work in Process, credit Materials
