Question 1

Factory labour costs

Accepted Answer

A)  omit holiday pay.
B)  are equal to the total amounts of the pay cheques the employees receive.
C)  are debited to work in process when incurred.
D)  include benefits for employees.E) A) and B)
F) None of the above

Question 2

Which of the following more closely describes job-order and process accounting differences?

Accepted Answer

A)  Job-order costing is best used when there are more material costs than labour costs involved.
B)  Process costing assigns costs to departments while job-order costing assigns costs to jobs.
C)  Process costing emphasizes the application of overheads more than job-order costing.
D)  Job-order costing emphasizes the application of overheads more than process costing.E) None of the above
F) A) and C)

Question 3

Which one of the following is the same amount as cost of goods manufactured on the cost of goods manufactured schedule?

Accepted Answer

A)  the amount transferred from Work in Process Inventory to Finished Goods during the period
B)  the total of direct material, direct labour, and manufacturing overhead which are added to Work in Process during the year
C)  the amount transferred out of Finished Goods Inventory during the year
D)  the total added to the Work in Process Inventory during the yearE) A) and D)
F) C) and D) A

Question 4

What does cost accounting measure, record, and report?

Accepted Answer

A)  product costs
B)  future costs
C)  manufacturing processes
D)  managerial accounting decisionsE) None of the above
F) A) and B)

Question 5

In which type of companies is overhead applied to jobs?

Accepted Answer

A)  with manufacturing and service companies
B)  only companies that have labour costs associated with products
C)  only manufacturing companies
D)  primarily with service companiesE) All of the above
F) A) and C)

Question 6

How is the employee time ticket used?

Accepted Answer

A)  It is kept as evidence of payment to employees.
B)  It is used only by the production supervisor to track which employees show up for work.
C)  It is used as a basis for determining the cost of labour to add to jobs.
D)  It is only sent to the accounting department to create pay cheques for employees.E) B) and D)
F) B) and C)

Question 7

In a normal costing system,

Accepted Answer

A)  actual manufacturing overhead costs are recorded in the respective Manufacturing Overhead Expense account as incurred.
B)  actual manufacturing overhead costs should be added as a cost to the specific jobs as the costs are incurred.
C)  applied manufacturing overhead costs reflect debits to the manufacturing overhead account.
D)  indirect costs are allocated based on the predetermined overhead rate times the actual quantity of the activity base.E) C) and D)
F) A) and C)

Question 8

To which control account do job cost sheets represent the subsidiary ledger?

Accepted Answer

A)  Cost of Goods Sold
B)  Cost of Goods Manufactured
C)  Work in Process Inventory
D)  Finished Goods InventoryE) A) and B)
F) None of the above

Question 9

When a job is completed, what happens to the cost of the job?

Accepted Answer

A)  It is removed from Work in Process and included in Cost of Goods Sold.
B)  It is removed from Finished Goods and included in Cost of Goods Sold.
C)  It is removed from Materials Inventory and included in Work in Process.
D)  It is removed from Work in Process and included in Finished Goods.E) All of the above
F) A) and B)

Question 10

Which of the following is true?

Accepted Answer

A)  The acquisition of raw materials causes the Work in Process account to increase.
B)  The Raw Materials account is used to recognize all raw materials purchases, purchases returns and allowances, and freight costs related to materials.
C)  When raw materials are purchased, the Raw Materials Inventory account is credited.
D)  The raw materials account only reflects direct materials.E) A) and B)
F) All of the above

Question 11

When monthly financial statements are prepared, where will you expect to find a difference between actual overhead and overhead applied?

Accepted Answer

A)  on the Statement of Stockholders' Equity
B)  none of the financial statements
C)  on the Balance Sheet
D)  on the Income StatementE) All of the above
F) A) and B)

Question 12

Which one of the following best describes a job cost sheet?

Accepted Answer

A)  It is used by management to understand how direct costs affect profitability.
B)  It is a daily form that management uses for tracking worker productivity on which employee raises are based.
C)  It is a form used to record the costs chargeable to a specific job and to determine the total and unit costs of the completed job.
D)  It is used to track manufacturing overhead costs to specific jobs.E) A) and C)
F) B) and C) C

Question 13

What are the two major steps in the flow of costs for a job cost system?

Accepted Answer

A)  accumulating and assigning
B)  allocating and assigning
C)  acquiring and accumulating
D)  accumulating and allocatingE) A) and D)
F) B) and D)

Question 14

Which is most often used in a job-order cost system?

Accepted Answer

A)  general ledger accounts only
B)  subsidiary accounts only
C)  control accounts and subsidiary accounts
D)  master accounts and design accountsE) C) and D)
F) A) and C)

Question 15

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 B)

Question 16

If the financial statements of Sushi Show, Inc.show $500 of over-applied overhead for the current year, where will that balance be shown in the financial statements if not material?

Accepted Answer

A)  in the current assets section as a prepaid amount
B)  No amount should be shown in the financial statements for over-applied overhead.
C)  in the current liabilities section as Unearned Revenue
D)  as part of Cost of Goods SoldE) A) and B)
F) All of the above

Question 17

In what manner does a company most likely maintain its records of individual items of raw materials?

Accepted Answer

A)  using a bar coding system
B)  in the Work in Process Inventory control account
C)  in the Raw Materials Inventory account in the general ledger
D)  in each of the separate job cost recordsE) All of the above
F) A) and D) A

Question 18

What journal entry should be made when a job is completed and all costs have been accumulated on a job cost sheet?

Accepted Answer

A)  a debit to Finished Goods Inventory, and a credit to Work in Process Inventory
B)  a debit to Work in Process Inventory, and a credit to Direct Materials, Direct Labour, and Manufacturing Overhead
C)  a debit to Finished Goods Inventory and a credit to Direct Materials, Direct Labour, and Manufacturing Overhead
D)  a debit to Cost of Goods Sold Inventory, and a credit to Work in Process InventoryE) A) and D)
F) A) and C)

Question 19

Which one of the following would most likely use a process cost system?

Accepted Answer

A)  a company that makes soup
B)  a company that creates advertisement campaigns
C)  a company which makes custom designed sailboats
D)  a company that paints housesE) All of the above
F) B) and C)

Question 20

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) B) and C)
F) None of the above

Exam 3: Job Order Costing

Factory labour costs

Correct AnswerverifiedShow Answer

Which of the following more closely describes job-order and process accounting differences?

Correct AnswerverifiedShow Answer

Which one of the following is the same amount as cost of goods manufactured on the cost of goods manufactured schedule?

Correct AnswerverifiedA

What does cost accounting measure, record, and report?

Correct AnswerverifiedShow Answer

In which type of companies is overhead applied to jobs?

Correct AnswerverifiedShow Answer

How is the employee time ticket used?

Correct AnswerverifiedShow Answer

In a normal costing system,

Correct AnswerverifiedShow Answer

To which control account do job cost sheets represent the subsidiary ledger?

Correct AnswerverifiedShow Answer

When a job is completed, what happens to the cost of the job?

Correct AnswerverifiedShow Answer

Which of the following is true?

Correct AnswerverifiedShow Answer

When monthly financial statements are prepared, where will you expect to find a difference between actual overhead and overhead applied?

Correct AnswerverifiedShow Answer

Which one of the following best describes a job cost sheet?

Correct AnswerverifiedC

What are the two major steps in the flow of costs for a job cost system?

Correct AnswerverifiedShow Answer

Which is most often used in a job-order cost system?

Correct AnswerverifiedShow Answer

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

If the financial statements of Sushi Show, Inc.show $500 of over-applied overhead for the current year, where will that balance be shown in the financial statements if not material?

Correct AnswerverifiedShow Answer

In what manner does a company most likely maintain its records of individual items of raw materials?

Correct AnswerverifiedA

What journal entry should be made when a job is completed and all costs have been accumulated on a job cost sheet?

Correct AnswerverifiedShow Answer

Which one of the following would most likely use a process cost system?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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C

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A

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