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Exam 5: Product and Service Costing: Job-Order System

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The costs of a completed job are transferred from the work-in-process inventory account to the finished goods inventory account.

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Explain why actual costing systems are rarely used in practice.

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Actual costing systems are rarely used i...

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The system which assign(s) costs by the job is termed:

When materials are purchased, the costs of the materials "flows" into the materials inventory account.

Stainless Steel Company has two production departments: A and B. Stainless Steel has following budgeted overhead costs and activity: Production data for job 20 and 21 are given below: a. Compare the costs per unit of Job 20 if Stainless Steel uses 1. a plantwide rate based on direct labor hours; 2. a plantwide rate based on machine hours; 3. departmental rates with Department A based on direct labor hours and Department B using machine hours. (round to 2 decimal places) b. Why is there such a variation in the cost per unit? Which method provides the best cost assignment? a. Compare the costs per unit of Job 20 if Stainless Steel uses

Figure 5 - 8 Lamour Corporation is a job order costing company that uses activity-based costing to apply overhead to jobs. The following overhead activities were budgeted for the year. The following information about the jobs was given for April. By April 30, Jobs 102 and 103 were completed and sold. The remaining jobs were still in process. -Refer to Figure 5-8. The ending work in process would consist of the costs of what jobs?

The absolute maximum production activity of a manufacturing firm is called:

Unit costs are critical for

The form indicates the type and quantity of each material issued to the factory.

The predetermined overhead rate is usually calculated at the

Figure 5 - 2 The Cameron Corporation manufactures custom-made purses. The following data pertains to Job XY5: Direct materials placed into production $4,000 Direct labor hours worked 50 hours Direct labor rate per hour $ 15 Machine hours worked 100 hours Factory overhead is applied using a plant-wide rate based on direct labor hours. Factory overhead was budgeted at $80,000 for the year and the direct labor hours were estimated to be 20,000. Job XY5 consists of 50 units. -Refer to Figure 5-2. What is overhead cost assigned to Job XY5?

In a job-order costing system, actual overhead costs never enter the work-in-process inventory accounts

Which cost accounting process would be most appropriate for accumulating costs of identical, standardized units?

When a job is shipped to a customer, the finished job cost becomes the cost of the sold.

Abnormal spoilage is charged to the job that caused it.

An actual overhead rate can be calculated

Perishability refers to the

Figure 5-5 Tonneau Corporation had the following information available for October 2016: Work in Process, October 1 $20,000 Materials placed into production, October 27,500 Direct labor, October 37,500 Factory overhead rate is 150 percent of direct labor costs. Job cost sheets had the following balances: Jobs Z3 and Z4 were not completed at the end of December. -Refer to Figure 5-5. What is the cost of goods finished during October for Tonneau Corporation?

The total applied overhead at a given point in time is given by the credit balance in the control account.

A debit to Materials Inventory indicates materials were