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Exam 2: A Further Look at Financial Statements

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Question 41

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In a job order cost accounting system, the Raw Materials Inventory account is

A) an expense.
B) a control account.
C) not used.
D) a period cost.

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Question 42

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A company expected its annual overhead costs to be $1,500,000 and direct labor costs to be $1,000,000.Actual overhead was $1,450,000, and actual labor costs totaled $1,100,000.How much is the company's predetermined overhead rate to the nearest cent?

A) $1.45
B) $1.31
C) $1.50
D) $1.37

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Question 43

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Minton Company provided the following information from its accounting records for 2017: $\begin{array}{lr}\text { Expected production } & 60,000 \text { labor hours } \\\text { Actual production } & 56,000 \text { labor hours } \\\text { Budgeted overhead } & \$ 1,800,000 \\\text { Actual overhead } & \$ 1,740,000\end{array}$ How much is the overhead application rate if Minton Company bases it on direct labor hours?

If, at the end of the year, Manufacturing Overhead has been overapplied, it means that

Madison Inc.uses job order costing for its brand new line of sewing machines.The cost incurred for production during 2017 totaled $18,000 of materials, $9,000 of direct labor costs, and $6,000 of manufacturing overhead applied.The company ships all goods as soon as they are completed which results in no finished goods inventory on hand at the end of any year.Beginning work in process totaled $15,000, and the ending balance is $9,000.During the year, the company completed 25 machines.How much is the cost per machine?

Total manufacturing costs for a period consists of the costs of direct materials used, the cost of direct labor incurred, and the manufacturing overhead applied during the period.

Greer Company developed the following data for the current year: $\begin{array}{lr}\text { Beginning work in process inventory } & \$ 136,000 \\\text { Direct materials used } & 208,000 \\\text { Actual overhead } & 176,000 \\\text { Overhead applied } & 184,000 \\\text { Cost of goods manufactured } & 900,000 \\\text { Total manufacturing costs } & 856,000\end{array}$ How much is Greer Company's direct labor cost for the year?

Which of the following is one of the components of cost accounting?

If manufacturing overhead has been underapplied during the year, the adjusting entry at the end of the year will show a

Records of individual items of raw materials would not be maintained

When raw materials are purchased, the Work in Process Inventory account is debited.

The job cost sheet does not show

The two basic types of cost accounting systems are

A time ticket does not indicate the

Overhead application is recorded with a

A job order cost system and a process cost system are two alternative methods for valuing inventories.

Simmons Inc.applies overhead to production at a predetermined rate of 90% based on direct labor cost.Job No.250, the only job still in process at the end of August, has been charged with manufacturing overhead of $8,100.What was the amount of direct materials charged to Job 250 assuming the balance in Work in Process inventory is $30,000?

The existence of under- or overapplied overhead at the end of the year:

The Manufacturing Overhead account shows debits of $30,000, $24,000, and $28,000 and one credit for $86,000.Based on this information, manufacturing overhead

Manufacturing costs are generally incurred in one period and recorded in a subsequent period.