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Exam 17: Job Order Costing

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Question 51

Multiple Choice

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For which of the following businesses would the process cost system be appropriate?

A) Book retailer
B) Dress designer
C) Lumber mill
D) Printing firm

E) C) and D)
F) All of the above

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Question 52

Multiple Choice

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Period costs are

A) found on the balance sheet.
B) not involved in the production process.
C) classified as direct labor, direct material, or factory overhead.
D) found on the job order cost sheets.

E) C) and D)
F) All of the above

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Question 53

Multiple Choice

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The period costs of a textbook publisher would include:

The controlling account for the cost ledger is:

Which of the following are the two main types of cost accounting systems for manufacturing operations?

Selected accounts with a credit amount omitted are presented as follows: What was the balance of Work in Process as of April 30?

The Cavy Company estimates that the factory overhead for the following year will be $1,250,000. The company has decided that the basis for applying factory overhead should be machine hours, which is estimated to be 40,000 hours. The machine hours for the month of April for all of the jobs was 4,780. If the actual factory overhead totaled $141,800, determine the over or under applied amount for the month.

Using the job order cost system, service organizations are able to bill customers on a weekly or monthly basis, even when the job has not been completed.

Discuss how job order cost information is used in decision making. What are some possible reasons that actual cost of materials would exceed expected costs for a job?

The current year's advertising costs are normally considered period costs.

Prepare the journal entry for materials and labor, based on the following:

During the period, labor costs incurred on account amounted to $275,000 including $200,000 for production orders and $75,000 for general factory use. In addition, factory overhead charged to production was $32,000. From the following, select the entry to record the direct labor costs.

A job order cost system would be appropriate for a crude oil refining business.

If the amount of factory overhead cost incurred exceeds the amount applied, the factory overhead account will have a:

The Winston Company estimates that the factory overhead for the following year will be $1,250,000. The company has decided that the basis for applying factory overhead should be machine hours, which is estimated to be 50,000 hours. The total machine hours for the year was 54,300. The actual factory overhead for the year was $1,375,000. Determine the over or under applied amount for the year.

The recording of the jobs completed would include a credit to:

Flagler Company allocates overhead based on machine hours. They estimated overhead costs for the year to be $420,000. Estimated machine hours were 50,000. Actual hours and costs for the year were 46,000 machine hours and $380,000 of overhead. Required: a. Calculate the overhead application rate for the year. b. What is the amount of applied overhead for the year? c. What is the amount of under or overapplied overhead for the year? Indicate whether it is over- or underapplied.

Put the following in the order of the flow of manufacturing costs for a company a. Closing under/over applied factory overhead to cost of goods sold b. Materials purchased c. Factory labor used and factory overhead incurred in production d. Completed jobs moved to finished goods e. Factory overhead applied to jobs according to the predetermined overhead rate f. Materials requisitioned to jobs g. Selling of finished product h. Preparation of financial statements to determine gross profit

On November 14th the Milling Department has accepted Job 111407A for 1,000 pounds of Cereal Mix. The bill of materials (BOM) for the Cereal Mix is: Manufacturing overhead is applied at $5.75 per pound completed, and $75.75 of materials are returned to Raw Materials Inventory. The recipe produced 1,025 pounds of cereal mix.

Costs that are treated as assets until the product is sold are called: