Question 1

Cost of goods sold is debited and finished goods inventory is credited for

Accepted Answer

A)  purchase of goods on account.
B)  transfer of goods to the finished goods storeroom.
C)  transfer of materials into work in process inventory.
D)  the sale of goods to a customer.

Question 2

The journal entry needed to record the completion of a job includes a

Accepted Answer

A)  credit to work in process inventory.
B)  credit to finished goods inventory.
C)  debit to work in process inventory.
D)  debit to cost of goods sold.

Question 3

Match between columns
                        Premises: ________ carpet manufacturer
________ custom home builder
________ paint manufacturer
________ concrete manufacturer
________ jumbo jet manufacturer

Accepted Answer

The Answer of process costing and job costing is...

Question 4

The overhead allocation base should be the cost driver of manufacturing overhead costs.

Accepted Answer

A) True 
 B)False

Question 5

Here are selected basic data for Wilson Company:  If the company allocates overhead based on direct labor cost, what are the total actual manufacturing overhead costs?

Accepted Answer

A)  $280,500
B)  $171,400
C)  $258,100
D)  $226,800

Question 6

Matthew Company uses a job cost system. The overhead account shows a $5,000 overallocated balance at the end of the year. Actual overhead incurred was $100,000. Other balances are:  The entry to close manufacturing overhead would include a

Accepted Answer

A)  debit to manufacturing overhead for $5,000.
B)  debit to work in process inventory for $5,000.
C)  debit to cost of goods sold for $5,000.
D)  credit to work in process for $5,000.

Question 7

Companies should always use job costing rather than process costing.

Accepted Answer

A) True 
 B)False

Question 8

Hilltop Manufacturing uses a predetermined manufacturing overhead rate based on machine hours to allocate manufacturing overhead to jobs. Selected data about the company's operations follows:  By how much was manufacturing overhead overallocated or underallocated for the year?

Accepted Answer

A)  $118,750 underallocated
B)  $118,750 overallocated
C)  $112,500 underallocated
D)  $112,500 overallocated

Question 9

Manufacturing overhead costs cannot be directly traced to jobs.

Accepted Answer

A) True 
 B)False

Question 10

If manufacturing overhead has been underallocated during the year, it means the jobs have been undercosted.

Accepted Answer

A) True 
 B)False

Question 11

The journal entry to assign $1,700 of direct labor and $300 of indirect labor involves a debit to

Accepted Answer

A)  manufacturing overhead for $2,000.
B)  work in process inventory for $2,000.
C)  work in process inventory for $1,700 and a credit to manufacturing overhead for $300.
D)  work in process inventory for $1,700 and manufacturing overhead for $300.

Question 12

The cost of direct labor used in production is recorded as a

Accepted Answer

A)  credit to manufacturing overhead.
B)  credit to work in process inventory.
C)  credit to wages expense.
D)  credit to wages payable.

Question 13

Here is selected data for Lori Corporation:  The journal entry to close manufacturing overhead would include a

Accepted Answer

A)  credit to manufacturing overhead for $4,000.
B)  debit to work in process inventory for $4,000.
C)  debit to manufacturing overhead for $4,000.
D)  debit to cost of goods sold for $4,000.

Question 14

When job costing is used as a service firm

Accepted Answer

A)  indirect costs are traced to client jobs.
B)  direct costs are allocated to client jobs.
C)  indirect costs are allocated to client jobs.
D)  all costs are allocated to client jobs.

Question 15

Here are selected data for Stehli Company:  If the company allocates overhead based on direct labor cost, what is the predetermined manufacturing overhead rate?

Accepted Answer

A)  78% of direct labor cost
B)  128% of direct labor cost
C)  79% of direct labor cost
D)  102% of direct labor cost

Question 16

A production schedule always covers a one-year period of time.

Accepted Answer

A) True 
 B)False

Question 17

Job costing should only be used by manufacturers.

Accepted Answer

A) True 
 B)False

Question 18

When job costing is used at a service firm, the bill to the client shows

Accepted Answer

A)  the billing rate and hours spent on the job.
B)  the allocation of indirect costs.
C)  the profit on the job.
D)  actual direct cost of providing the service.

Question 19

If the actual amount of the manufacturing overhead allocation base is greater than the estimated amount of the allocation base used to calculate the predetermined rate, then manufacturing overhead must have been underallocated.

Accepted Answer

A) True 
 B)False

Question 20

Underallocated manufacturing overhead results when

Accepted Answer

A)  production is greater than last year.
B)  actual overhead is greater than expected.
C)  actual overhead is greater than allocated overhead.
D)  estimated overhead is greater than actual overhead.

Exam 3: Job Costing

Underallocated manufacturing overhead results when

Correct Answer
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When job costing is used as a service firm

Correct Answer
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Here is selected data for Lori Corporation: The journal entry to close manufacturing overhead would include a

Correct Answer
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Matthew Company uses a job cost system. The overhead account shows a $5,000 overallocated balance at the end of the year. Actual overhead incurred was $100,000. Other balances are: The entry to close manufacturing overhead would include a

Correct Answer
verified

Companies should always use job costing rather than process costing.

Correct Answer
verified

If the actual amount of the manufacturing overhead allocation base is greater than the estimated amount of the allocation base used to calculate the predetermined rate, then manufacturing overhead must have been underallocated.

Correct Answer
verified

The overhead allocation base should be the cost driver of manufacturing overhead costs.

Correct Answer
verified

If manufacturing overhead has been underallocated during the year, it means the jobs have been undercosted.

Correct Answer
verified

Here are selected data for Stehli Company: If the company allocates overhead based on direct labor cost, what is the predetermined manufacturing overhead rate?

Correct Answer
verified

Job costing should only be used by manufacturers.

Correct Answer
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The cost of direct labor used in production is recorded as a

Correct Answer
verified

Here are selected basic data for Wilson Company: If the company allocates overhead based on direct labor cost, what are the total actual manufacturing overhead costs?

Correct Answer
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State whether each company below would be more likely to use a job costing system or a process costing system.

Hilltop Manufacturing uses a predetermined manufacturing overhead rate based on machine hours to allocate manufacturing overhead to jobs. Selected data about the company's operations follows: By how much was manufacturing overhead overallocated or underallocated for the year?

Correct Answer
verified

Manufacturing overhead costs cannot be directly traced to jobs.

Correct Answer
verified

A production schedule always covers a one-year period of time.

Correct Answer
verified

Cost of goods sold is debited and finished goods inventory is credited for

Correct Answer
verified

The journal entry to assign $1,700 of direct labor and $300 of indirect labor involves a debit to

Correct Answer
verified

When job costing is used at a service firm, the bill to the client shows

Correct Answer
verified

The journal entry needed to record the completion of a job includes a

Correct Answer
verified

Exam 3: Job Costing

Underallocated manufacturing overhead results when

Correct AnswerverifiedShow Answer

When job costing is used as a service firm

Correct AnswerverifiedShow Answer

Here is selected data for Lori Corporation: The journal entry to close manufacturing overhead would include a

Correct AnswerverifiedShow Answer

Matthew Company uses a job cost system. The overhead account shows a $5,000 overallocated balance at the end of the year. Actual overhead incurred was $100,000. Other balances are: The entry to close manufacturing overhead would include a

Correct AnswerverifiedShow Answer

Companies should always use job costing rather than process costing.

Correct AnswerverifiedShow Answer

If the actual amount of the manufacturing overhead allocation base is greater than the estimated amount of the allocation base used to calculate the predetermined rate, then manufacturing overhead must have been underallocated.

Correct AnswerverifiedShow Answer

The overhead allocation base should be the cost driver of manufacturing overhead costs.

Correct AnswerverifiedShow Answer

If manufacturing overhead has been underallocated during the year, it means the jobs have been undercosted.

Correct AnswerverifiedShow Answer

Here are selected data for Stehli Company: If the company allocates overhead based on direct labor cost, what is the predetermined manufacturing overhead rate?

Correct AnswerverifiedShow Answer

Job costing should only be used by manufacturers.

Correct AnswerverifiedShow Answer

The cost of direct labor used in production is recorded as a

Correct AnswerverifiedShow Answer

Here are selected basic data for Wilson Company: If the company allocates overhead based on direct labor cost, what are the total actual manufacturing overhead costs?

Correct AnswerverifiedShow Answer

State whether each company below would be more likely to use a job costing system or a process costing system.

Hilltop Manufacturing uses a predetermined manufacturing overhead rate based on machine hours to allocate manufacturing overhead to jobs. Selected data about the company's operations follows: By how much was manufacturing overhead overallocated or underallocated for the year?

Correct AnswerverifiedShow Answer

Manufacturing overhead costs cannot be directly traced to jobs.

Correct AnswerverifiedShow Answer

A production schedule always covers a one-year period of time.

Correct AnswerverifiedShow Answer

Cost of goods sold is debited and finished goods inventory is credited for

Correct AnswerverifiedShow Answer

The journal entry to assign $1,700 of direct labor and $300 of indirect labor involves a debit to

Correct AnswerverifiedShow Answer

When job costing is used at a service firm, the bill to the client shows

Correct AnswerverifiedShow Answer

The journal entry needed to record the completion of a job includes a

Correct AnswerverifiedShow Answer

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