Question 1

In an activity-based costing system, manufacturing overhead costs are divided into separate:

Accepted Answer

A)   Cost drivers.
B)   Activity cost pools.
C)   Activity bases.
D)   Indirect cost centers.E) B) and C)
F) A) and D)

Question 2

Refer to the above data. If Riverview applies overhead using a predetermined rate based on machine-hours, what amount of overhead will be assigned to a unit of output which requires 0.5 machine hours and 0.25 labor hours to complete?

Accepted Answer

A)   $12.00.
B)   $16.00.
C)   $20.00.
D)   Some other amount.E) B) and C)
F) A) and D)

Question 3

Job order costing is appropriate for businesses that produce mass quantities of identical units using the same amount of direct materials, direct labor, and manufacturing overhead.

Accepted Answer

A) True 
 B)False

Question 4

What are the total manufacturing overhead costs allocated to the Baby Swings for the current month?

Accepted Answer

A)   $69,837.
B)   $102,873.
C)   $37,290.
D)   $210,000.E) A) and B)
F) None of the above C

Question 5

A job cost sheet usually contains a record of each of the following except:

Accepted Answer

A)   The cost of direct materials charged to a particular job.
B)   The overhead costs actually incurred on a particular job.
C)   The cost of direct labor charged to a particular job.
D)   The overhead cost applied to a particular job.E) A) and B)
F) A) and C)

Question 6

What is the work in process inventory at October 31? $___________

Accepted Answer

The answer of What is the work in process inventory...

Question 7

Manufacturing overhead is not:

Accepted Answer

A)   A product cost.
B)   An indirect cost.
C)   A manufacturing cost.
D)   A period cost.E) None of the above
F) A) and B)

Question 8

A predetermined overhead application rate:

Accepted Answer

A)   Is used in a job order cost system but cannot be used in a process cost system.
B)   Can be determined by dividing budgeted direct labor cost by the budgeted factory overhead costs.
C)   Is not generally accepted for financial reporting purposes.
D)   Tends to avoid wide variations in per-unit overhead costs because of short-run changes in volume.E) A) and B)
F) A) and C)

Question 9

When a job is completed:

Accepted Answer

A)   Cost of goods sold is debited.
B)   Work-in-process inventory is debited.
C)   Finished goods inventory is credited.
D)   None of the above.E) C) and D)
F) A) and B)

Question 10

Activity-based costing tracks cost to the activities that consume resources.

Accepted Answer

A) True 
 B)False  True

Question 11

A debit balance in the Manufacturing Overhead account at the end of the period indicates that overhead has been under-applied to jobs.

Accepted Answer

A) True 
 B)False

Question 12

Job order cost system-journal entries
Shown below is a partial list of accounts for Miles Mfg. Co., followed by a list of transactions. Indicate the accounts that would be debited and credited in recording each transaction by placing the appropriate account numbers in the space provided. The company uses a job order cost accounting system.
 $$\begin{array} { | l | l | l | } 
\hline \text { (1) Cash } & \text { (6) } & \text { Cost of Goods Sold } \
\hline \text { (2) Materials Inventory } & \text { (7) } & \text { Direct Labor } \
\hline \text { (3) Work-in-Process Inventory } & \text { (8) } & \text { Manufacturing Overhead } \
\hline \text { (4) Finished Goods Inventory } & & \text { (controlling account) } \
\hline \text { (5) Sales } & & \
\hline
\end{array}$$

Accepted Answer

The answer of Job order cost system-journal entries
Shown below is...

Question 13

The year-end balance in the Materials Inventory controlling account is equal to:

Accepted Answer

A)   The total of the various materials subsidiary ledger accounts (the materials on hand at the end of the period.) 
B)   The total amount of materials requisitioned during the period.
C)   The total amount of materials purchased during the period.
D)   The amount of materials debited to the Work-in-Process Inventory account during the period.E) None of the above
F) A) and C)

Question 14

A job cost sheet should:

Accepted Answer

A)   Contain information that summarizes all jobs finished.
B)   Contain information on each individual job in process.
C)   Contain only the direct costs of a particular job.
D)   Only be used for jobs that have been completed.E) B) and C)
F) A) and D)

Question 15

The account Finished Goods:

Accepted Answer

A)   Consists of completed goods that have not yet been sold.
B)   Consists of goods being manufactured that are incomplete.
C)   Consists of materials to be used in the production process.
D)   Consists of the cost of new materials used, labor but not overhead.E) A) and B)
F) A) and D)

Question 16

Which of the following statements is true about activity-based costing?

Accepted Answer

A)   Only one activity should be used for a company.
B)   Many different activity bases are used in applying overhead.
C)   There can only be one cost driver.
D)   Direct materials and direct labor are applied to work-in-process based upon cost drivers.E) A) and B)
F) A) and C)

Question 17

Metalworks employs 3 assembly workers that, on average, each work 40 hours per week and earn $9 per hour. During the current accounting period, Job #543 consumed 77 hours of direct labor totaling $693.
77 direct labor hours x $9 = $693.

Accepted Answer

A) True 
 B)False

Question 18

The amount of direct materials cost charged to completed jobs during March was:

Accepted Answer

A)   $20,000.
B)   $50,000.
C)   $30,000.
D)   Some other amount.E) None of the above
F) B) and C) C

Question 19

The use of activity-based costing is most appropriate for:

Accepted Answer

A)   Firms that manufacture multiple product lines.
B)   Firms that have very low manufacturing overhead costs relative to other costs of production.
C)   Firms with high levels of production activity.
D)   Firms that account separately for product and period costs.E) A) and B)
F) A) and C)

Question 20

An overhead application rate is computed by dividing the estimated overhead costs by the expected amount of units in the activity base.

Accepted Answer

A) True 
 B)False

Exam 17: Job Order Cost Systems and Overhead Allocations

In an activity-based costing system, manufacturing overhead costs are divided into separate:

Correct Answer
verified

Refer to the above data. If Riverview applies overhead using a predetermined rate based on machine-hours, what amount of overhead will be assigned to a unit of output which requires 0.5 machine hours and 0.25 labor hours to complete?

Correct Answer
verified

Job order costing is appropriate for businesses that produce mass quantities of identical units using the same amount of direct materials, direct labor, and manufacturing overhead.

Correct Answer
verified

What are the total manufacturing overhead costs allocated to the Baby Swings for the current month?

Correct Answer
verified
C

A job cost sheet usually contains a record of each of the following except:

Correct Answer
verified

What is the work in process inventory at October 31? $___________

Correct Answer
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Manufacturing overhead is not:

Correct Answer
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A predetermined overhead application rate:

Correct Answer
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When a job is completed:

Correct Answer
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Activity-based costing tracks cost to the activities that consume resources.

Correct Answer
verified
True

A debit balance in the Manufacturing Overhead account at the end of the period indicates that overhead has been under-applied to jobs.

Correct Answer
verified

Correct Answer
verified

The year-end balance in the Materials Inventory controlling account is equal to:

Correct Answer
verified

A job cost sheet should:

Correct Answer
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The account Finished Goods:

Correct Answer
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Which of the following statements is true about activity-based costing?

Correct Answer
verified

Metalworks employs 3 assembly workers that, on average, each work 40 hours per week and earn $9 per hour. During the current accounting period, Job #543 consumed 77 hours of direct labor totaling $693. 77 direct labor hours x $9 = $693.

Correct Answer
verified

The amount of direct materials cost charged to completed jobs during March was:

Correct Answer
verified
C

The use of activity-based costing is most appropriate for:

Correct Answer
verified

An overhead application rate is computed by dividing the estimated overhead costs by the expected amount of units in the activity base.

Correct Answer
verified

Exam 17: Job Order Cost Systems and Overhead Allocations

In an activity-based costing system, manufacturing overhead costs are divided into separate:

Correct AnswerverifiedShow Answer

Refer to the above data. If Riverview applies overhead using a predetermined rate based on machine-hours, what amount of overhead will be assigned to a unit of output which requires 0.5 machine hours and 0.25 labor hours to complete?

Correct AnswerverifiedShow Answer

Job order costing is appropriate for businesses that produce mass quantities of identical units using the same amount of direct materials, direct labor, and manufacturing overhead.

Correct AnswerverifiedShow Answer

What are the total manufacturing overhead costs allocated to the Baby Swings for the current month?

Correct AnswerverifiedC

A job cost sheet usually contains a record of each of the following except:

Correct AnswerverifiedShow Answer

What is the work in process inventory at October 31? $___________

Correct AnswerverifiedShow Answer

Manufacturing overhead is not:

Correct AnswerverifiedShow Answer

A predetermined overhead application rate:

Correct AnswerverifiedShow Answer

When a job is completed:

Correct AnswerverifiedShow Answer

Activity-based costing tracks cost to the activities that consume resources.

Correct AnswerverifiedTrue

A debit balance in the Manufacturing Overhead account at the end of the period indicates that overhead has been under-applied to jobs.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The year-end balance in the Materials Inventory controlling account is equal to:

Correct AnswerverifiedShow Answer

A job cost sheet should:

Correct AnswerverifiedShow Answer

The account Finished Goods:

Correct AnswerverifiedShow Answer

Which of the following statements is true about activity-based costing?

Correct AnswerverifiedShow Answer

Metalworks employs 3 assembly workers that, on average, each work 40 hours per week and earn $9 per hour. During the current accounting period, Job #543 consumed 77 hours of direct labor totaling $693. 77 direct labor hours x $9 = $693.

Correct AnswerverifiedShow Answer

The amount of direct materials cost charged to completed jobs during March was:

Correct AnswerverifiedC

The use of activity-based costing is most appropriate for:

Correct AnswerverifiedShow Answer

An overhead application rate is computed by dividing the estimated overhead costs by the expected amount of units in the activity base.

Correct AnswerverifiedShow Answer

Correct Answer
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C

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True

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C

Correct Answer
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