Question 1

Which of the following will you find on a labour time ticket?

Accepted Answer

A)  total labour cost to be charged to job for the respective time ticket
B)  cost of materials requisitioned for the job
C)  estimated labour cost total for a job
D)  total labour cost incurred to date for a jobE) All of the above
F) B) and D)

Question 2

Which of the following statements regarding the Raw Materials Inventory account is correct?

Accepted Answer

A)  Freight costs related to acquiring materials are credited.
B)  Purchase returns and allowances are debited.
C)  The invoice cost of purchasing materials is debited.
D)  Any purchase discounts taken are debited.E) C) and D)
F) All of the above

Question 3

The acquisition of raw materials causes the Work in Process account to increase.

Accepted Answer

A) True 
 B)False

Question 4

Which one of the following is used to calculate the predetermined overhead rate?

Accepted Answer

A)  applied overhead costs
B)  actual overhead costs
C)  predetermined overhead costs
D)  estimated overhead costsE) All of the above
F) A) and B)

Question 5

What transaction is recorded when direct labour is assigned to jobs?

Accepted Answer

A)  a debit to Work in Process Inventory and a credit to Factory Labour
B)  a debit to Manufacturing Overhead and a credit to Factory Labour
C)  a debit to Factory Labour and a credit to Manufacturing Overhead
D)  a debit to Factory Labour and a credit to Work in Process InventoryE) B) and C)
F) A) and D)

Question 6

If over-applied overhead is considered material, it is subtracted from Work in Process upon disposal.

Accepted Answer

A) True 
 B)False

Question 7

Fringe benefits and payroll taxes associated with factory workers should be accumulated as a part of manufacturing overhead.

Accepted Answer

A) True 
 B)False

Question 8

If monthly financial statements are prepared, over-applied overhead is shown as an operating expense on the Income Statement.

Accepted Answer

A) True 
 B)False

Question 9

Finished Goods Inventory is a control account that controls individual finished goods records in a Finished Goods subsidiary ledger.

Accepted Answer

A) True 
 B)False

Question 10

In a job-order cost system, each entry to the Raw Material Inventory account should be accompanied by a posting to one or more job cost sheets.

Accepted Answer

A) True 
 B)False

Question 11

Tan Company over-applied manufacturing overhead during 2016.Which one of the following is part of the year-end entry to adjust the over-applied amount assuming the amount is material?

Accepted Answer

A)  a debit to Work in Process Inventory
B)  a debit to Cost of Goods Sold
C)  a debit to Manufacturing Overhead
D)  a credit to Unearned RevenueE) C) and D)
F) A) and B)

Question 12

Over-applied overhead means that actual manufacturing overhead costs were less than the manufacturing overhead costs allocated to jobs.

Accepted Answer

A) True 
 B)False

Question 13

Which one of the following is used in assigning manufacturing costs to work in process inventory?

Accepted Answer

A)  materials purchased invoices
B)  finished goods inventory costs
C)  actual manufacturing overhead
D)  estimated manufacturing overheadE) All of the above
F) None of the above

Question 14

In order to adjust for the over/under-applied manufacturing overhead, Abe Company increased its balance in the Cost of Goods Sold account only.This implies that

Accepted Answer

A)  the company incurred more overhead costs than the overhead assigned to jobs, and the amount was not material.
B)  the company incurred less overhead costs than the overhead assigned to jobs, and the amount was material.
C)  the company incurred more overhead costs than the overhead assigned to the jobs, and the amount was material.
D)  the company incurred less overhead costs than the overhead assigned to jobs, and the amount was not material.E) B) and C)
F) A) and B)

Question 15

What is unique about the flow of costs in a job-order cost system?

Accepted Answer

A)  Each job is costed separately in a Work in Process subsidiary ledger.
B)  It involves accumulating material, labour, and manufacturing overhead costs as they are incurred in order to determine the job cost.
C)  Job costs cannot be measured until all overhead costs are determined.
D)  There are no costs remaining in Work in Process at year end.E) A) and B)
F) A) and D)

Question 16

Which one of the following is a procedure as part of assigning manufacturing costs in a job-order cost system?

Accepted Answer

A)  adding manufacturing overhead costs to Work in Process as they are incurred
B)  transferring the costs of completed goods out of Finished Goods
C)  adding actual manufacturing overhead costs to jobs
D)  adding direct materials costs to Work in Process as the materials are usedE) C) and D)
F) B) and C)

Question 17

A company completed all postings for its job costs for the year.Which of the following should have the same totals at year end?

Accepted Answer

A)  the cost of materials purchased and the total of the Raw Materials Inventory control account
B)  the total of the amount in the Work in Process subsidiary ledger and the Work in Process Inventory control account total
C)  the total of the accounts in the Work in Process subsidiary ledger and the Raw Materials Inventory control account total
D)  the cost of materials charged to Work in Process Inventory and the total of the accounts in the Work in Process subsidiary ledgerE) B) and D)
F) B) and C)

Question 18

What is the primary role of a job cost sheet?

Accepted Answer

A)  It lists the materials on hand available to be used for jobs.
B)  It is the primary accounting record used in assigning costs to jobs.
C)  It is used instead of a cost of goods manufactured schedule.
D)  It shows the detail of the Manufacturing Overhead Control account.E) A) and B)
F) B) and D)

Question 19

The following information is available for completed Job No.402: Direct materials, $80,000; direct labour, $120,000; manufacturing overhead applied, $60,000; units produced, 5,000 units; units sold, 4,000 units.The cost of the finished goods on hand from this job is

Accepted Answer

A)  $52,000.
B)  $260,000.
C)  $40,000.
D)  $208,000.E) B) and C)
F) A) and D)

Question 20

A job-order cost system is most appropriate when products that are produced have their own distinguishing characteristics.

Accepted Answer

A) True 
 B)False

Exam 3: Job-Order Cost Accounting

In order to adjust for the over/under-applied manufacturing overhead, Abe Company increased its balance in the Cost of Goods Sold account only.This implies that

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The acquisition of raw materials causes the Work in Process account to increase.

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Fringe benefits and payroll taxes associated with factory workers should be accumulated as a part of manufacturing overhead.

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Which one of the following is a procedure as part of assigning manufacturing costs in a job-order cost system?

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Which of the following statements regarding the Raw Materials Inventory account is correct?

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In a job-order cost system, each entry to the Raw Material Inventory account should be accompanied by a posting to one or more job cost sheets.

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If monthly financial statements are prepared, over-applied overhead is shown as an operating expense on the Income Statement.

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Which one of the following is used in assigning manufacturing costs to work in process inventory?

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Which of the following will you find on a labour time ticket?

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Which one of the following is used to calculate the predetermined overhead rate?

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What transaction is recorded when direct labour is assigned to jobs?

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What is the primary role of a job cost sheet?

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The following information is available for completed Job No.402: Direct materials, $80,000; direct labour, $120,000; manufacturing overhead applied, $60,000; units produced, 5,000 units; units sold, 4,000 units.The cost of the finished goods on hand from this job is

Correct AnswerverifiedShow Answer

A job-order cost system is most appropriate when products that are produced have their own distinguishing characteristics.

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What is unique about the flow of costs in a job-order cost system?

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Over-applied overhead means that actual manufacturing overhead costs were less than the manufacturing overhead costs allocated to jobs.

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Finished Goods Inventory is a control account that controls individual finished goods records in a Finished Goods subsidiary ledger.

Correct AnswerverifiedShow Answer

If over-applied overhead is considered material, it is subtracted from Work in Process upon disposal.

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Tan Company over-applied manufacturing overhead during 2016.Which one of the following is part of the year-end entry to adjust the over-applied amount assuming the amount is material?

Correct AnswerverifiedShow Answer

A company completed all postings for its job costs for the year.Which of the following should have the same totals at year end?

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