Question 1

Dye Co. uses a job cost system and predetermines a factory overhead rate based on the amount of expected fixed costs and expected volume. At the conclusion of the fiscal year, overapplied overhead could be explained by which of the following?

Accepted Answer

A)  Option A
B)  Option B
C)  Option C
D)  Option DE) All of the above
F) None of the above

Question 2

Which of the following is not a method the management accountant must address regarding the costing system?

Accepted Answer

A)  Cost accumulation method.
B)  Cost measurement method.
C)  Labor decision method.
D)  Overhead assignment method.E) C) and D)
F) B) and D)

Question 3

A hybrid costing system that uses job costing to assign direct materials costs, and process costing to assign conversion costs to products or services is:

Accepted Answer

A)  Process costing.
B)  Operation costing.
C)  Actual costing.
D)  Product costing.
E)  Job costing.F) C) and D)
G) All of the above

Question 4

Assuming ABC Company applied overhead based on direct labor hours, the company's predetermined overhead rate for the year is:

Accepted Answer

A)  $43.95 per direct labor hour.
B)  $15.50 per direct labor hour.
C)  $15.00 per direct labor hour.
D)  $14.28 per direct labor hour.
E)  $14.00 per direct labor hour.F) A) and C)
G) D) and E)

Question 5

Job costing in service industries uses recording procedures and accounts similar to those illustrated in the chapter except for:

Accepted Answer

A)  Direct labor.
B)  Overhead costs.
C)  Direct materials.
D)  Cost drivers.E) A) and C)
F) None of the above

Question 6

The predetermined factory overhead rate includes:

Accepted Answer

A)  Estimated annual sales.
B)  Estimated total amount of cost driver.
C)  Estimated total cost.
D)  Estimated electricity consumed.E) A) and D)
F) B) and C)

Question 7

The primary focus of job costing in service industries is on:

Accepted Answer

A)  Direct materials.
B)  Direct labor.
C)  Indirect materials.
D)  Supplies.
E)  Factory overhead.F) A) and E)
G) B) and D)

Question 8

The amount of direct materials purchased during the year is:

Accepted Answer

A)  $391,000.
B)  $388,000.
C)  $377,000.
D)  $380,000.
E)  $374,000.F) A) and D)
G) A) and B)

Question 9

The three major differences between process and job order costing systems are those relating to:

Accepted Answer

A)  Quantity, quality, and cost.
B)  Speed, accuracy, and design.
C)  Cost object, product or service variety, and timing of unit cost calculation.
D)  Responsibility for cost, system design, and authorization codes.
E)  None of the above is correct.F) A) and E)
G) None of the above

Question 10

Operation costing uses which of the following costing systems?

Accepted Answer

A)  Option A
B)  Option B
C)  Option C
D)  Option DE) B) and C)
F) B) and D)

Question 11

Which of the following is not a cost element on the job cost sheet?

Accepted Answer

A)  Materials.
B)  Labor.
C)  Hours.
D)  Overhead.E) C) and D)
F) None of the above

Question 12

The key distinction between job costing and process costing is:

Accepted Answer

A)  The difference in detail required by each approach.
B)  The use made of the collected data.
C)  The journal entries required.
D)  The cost object for which costs are accumulated.
E)  The standards applied.F) None of the above
G) A) and C)

Question 13

The journal entry to dispose of overapplied or underapplied overhead, if overhead is applied based on direct labor hours, would include a credit to:

Accepted Answer

A)  Work-in-Process Inventory.
B)  Cost of Goods Sold.
C)  Finished Goods Inventory.
D)  Factory Overhead Control.
E)  Materials Inventory.F) C) and E)
G) All of the above

Question 14

The amount of underapplied or overapplied overhead is:

Accepted Answer

A)  $60,000 overapplied.
B)  $60,000 underapplied.
C)  $10,000 overapplied.
D)  $10,000 underapplied.
E)  $0.F) A) and B)
G) B) and D)

Question 15

If overhead is applied based on direct labor hours, the overapplied/underapplied overhead is:

Accepted Answer

A)  $15,300 underapplied.
B)  $15,300 overapplied.
C)  $51,600 underapplied.
D)  $51,600 overapplied.
E)  $-0-F) A) and E)
G) A) and D)

Question 16

The following are types of rework except:

Accepted Answer

A)  Rework on normal defective units common to all jobs.
B)  Rework on abnormal defective units not falling within the normal range.
C)  Rework on normal defective units for a particular job.
D)  All of the above are types of rework, with no exception.E) B) and C)
F) C) and D)

Question 17

When completed units are sold:

Accepted Answer

A)  Cost of Goods Sold account is credited.
B)  Cost of Goods Manufactured account is credited.
C)  Finished Goods Inventory account is credited.
D)  Work-in-Process Inventory account is credited.
E)  Finished Goods Inventory account is debited.F) A) and B)
G) A) and C)

Question 18

The system where the cost of a product or service is obtained by assigning costs to masses of similar units in each department and then computing unit cost on an average basis is called

Accepted Answer

A)  A process costing system.
B)  A job costing system.
C)  An activity-based costing system.
D)  An inventory materials control system.
E)  None of the above.F) A) and E)
G) D) and E)

Question 19

Ramirez Company uses a predetermined overhead rate. Overhead for the next twelve months is estimated to be $500,000. Ramirez applies overhead as a percentage of direct labor cost. Direct labor costs are estimated to be $625,000 for the next year. During the year actual direct labor costs amounted to $600,000 and the actual overhead was as follows:  Required:
(1) Calculate the over/under-applied overhead for the year.
(2) Prepare the journal entry to close the overhead accounts, assuming that the over/under-applied overhead is closed to cost of goods sold.

Accepted Answer

Answer may vary
Feedback: (1) Applicatio...

Question 20

When completed units are transferred to the warehouse:

Accepted Answer

A)  Cost of Goods Sold account is debited.
B)  Cost of Goods Manufactured account is debited.
C)  Finished Goods Inventory account is debited.
D)  Work-in-Process Inventory account is debited.
E)  Finished Goods Inventory account is credited.F) A) and E)
G) B) and E)

Exam 4: Job Costing

Dye Co. uses a job cost system and predetermines a factory overhead rate based on the amount of expected fixed costs and expected volume. At the conclusion of the fiscal year, overapplied overhead could be explained by which of the following?

Correct Answer
verified

Correct Answer
verified
Answer may vary
Feedback: (1) Applicatio...
View Answer

The amount of direct materials purchased during the year is:

Correct Answer
verified

A hybrid costing system that uses job costing to assign direct materials costs, and process costing to assign conversion costs to products or services is:

Correct Answer
verified

The predetermined factory overhead rate includes:

Correct Answer
verified

Which of the following is not a method the management accountant must address regarding the costing system?

Correct Answer
verified

Assuming ABC Company applied overhead based on direct labor hours, the company's predetermined overhead rate for the year is:

Correct Answer
verified

The amount of underapplied or overapplied overhead is:

Correct Answer
verified

When completed units are sold:

Correct Answer
verified

The three major differences between process and job order costing systems are those relating to:

Correct Answer
verified

The following are types of rework except:

Correct Answer
verified

Which of the following is not a cost element on the job cost sheet?

Correct Answer
verified

The journal entry to dispose of overapplied or underapplied overhead, if overhead is applied based on direct labor hours, would include a credit to:

Correct Answer
verified

The system where the cost of a product or service is obtained by assigning costs to masses of similar units in each department and then computing unit cost on an average basis is called

Correct Answer
verified

Job costing in service industries uses recording procedures and accounts similar to those illustrated in the chapter except for:

Correct Answer
verified

The primary focus of job costing in service industries is on:

Correct Answer
verified

If overhead is applied based on direct labor hours, the overapplied/underapplied overhead is:

Correct Answer
verified

Operation costing uses which of the following costing systems?

Correct Answer
verified

The key distinction between job costing and process costing is:

Correct Answer
verified

When completed units are transferred to the warehouse:

Correct Answer
verified

Exam 4: Job Costing

Dye Co. uses a job cost system and predetermines a factory overhead rate based on the amount of expected fixed costs and expected volume. At the conclusion of the fiscal year, overapplied overhead could be explained by which of the following?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedAnswer may varyFeedback: (1) Applicatio...View AnswerShow Answer

The amount of direct materials purchased during the year is:

Correct AnswerverifiedShow Answer

A hybrid costing system that uses job costing to assign direct materials costs, and process costing to assign conversion costs to products or services is:

Correct AnswerverifiedShow Answer

The predetermined factory overhead rate includes:

Correct AnswerverifiedShow Answer

Which of the following is not a method the management accountant must address regarding the costing system?

Correct AnswerverifiedShow Answer

Assuming ABC Company applied overhead based on direct labor hours, the company's predetermined overhead rate for the year is:

Correct AnswerverifiedShow Answer

The amount of underapplied or overapplied overhead is:

Correct AnswerverifiedShow Answer

When completed units are sold:

Correct AnswerverifiedShow Answer

The three major differences between process and job order costing systems are those relating to:

Correct AnswerverifiedShow Answer

The following are types of rework except:

Correct AnswerverifiedShow Answer

Which of the following is not a cost element on the job cost sheet?

Correct AnswerverifiedShow Answer

The journal entry to dispose of overapplied or underapplied overhead, if overhead is applied based on direct labor hours, would include a credit to:

Correct AnswerverifiedShow Answer

The system where the cost of a product or service is obtained by assigning costs to masses of similar units in each department and then computing unit cost on an average basis is called

Correct AnswerverifiedShow Answer

Job costing in service industries uses recording procedures and accounts similar to those illustrated in the chapter except for:

Correct AnswerverifiedShow Answer

The primary focus of job costing in service industries is on:

Correct AnswerverifiedShow Answer

If overhead is applied based on direct labor hours, the overapplied/underapplied overhead is:

Correct AnswerverifiedShow Answer

Operation costing uses which of the following costing systems?

Correct AnswerverifiedShow Answer

The key distinction between job costing and process costing is:

Correct AnswerverifiedShow Answer

When completed units are transferred to the warehouse:

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
Answer may vary
Feedback: (1) Applicatio...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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