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Exam 15: Job Order Costing and Analysis

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Question 31

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A company that uses a cost accounting system normally has only two inventory accounts: Finished Goods Inventory and Work in Process Inventory.

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Question 32

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When direct labor costs are recorded,the journal entry is a debit to Factory Wages Payable and a credit to Work in Process Inventory.

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Question 33

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Job order production is also known as:

If overhead is underapplied,it means that individual jobs have not been charged enough during the year and the cost of goods sold reported is too low.

When actual overhead cost exceeds the overhead applied,overhead is said to be underapplied.

A ________ is a separate record maintained for each job.

Minstrel Manufacturing uses a job order costing system.During one month,Minstrel purchased $198,000 of raw materials on credit; issued materials to production of $195,000 of which $30,000 were indirect.Minstrel incurred a factory payroll of $150,000,of which $40,000 was indirect labor.Minstrel uses a predetermined overhead rate of 150% of direct labor cost. -The journal entry to record the issuance of materials to production is:

When the actual overhead incurred during an accounting period is more than the overhead applied to jobs,the overhead is said to be ________.

A company that makes which of the following types of products would best be suited for a job costing system?

Heintz Company's job order costing system applies overhead based on direct labor costs.The company's manufacturing costs for the current year were: direct materials,$108,000; direct labor,$144,000; and factory overhead,$36,000.At year-end,the total cost of Work in Process is $38,000,which includes $12,000 of direct labor cost.What amount of direct material cost is included in the ending Work in Process inventory?

The total cost on job cost sheets for all jobs in process equals the amount in the ________ Inventory account.

Overapplied overhead is the amount by which actual overhead cost exceeds the overhead applied to products during the period.

There are two basic types of cost accounting systems: job order costing and periodic costing.

Lowden Company has a predetermined overhead rate of 160% and allocates overhead based on direct material cost.During the current period,direct labor cost is $50,000 and direct materials cost is $80,000.How much overhead cost should Lowden Company should apply in the current period?

A company that produces products individually designed to meet the needs of a specific customer,would normally use a job order costing system.

When direct labor costs are recorded in a job costing:

A materials requisition is a source document used by production managers to request materials for production and also used to assign materials costs to specific jobs or to overhead.

Job A3B was ordered by a customer on September 25.During the month of September,Jaycee Corporation requisitioned $2,500 of direct materials and used $4,000 of direct labor.The job was not finished by the end of September,but needed an additional $3,000 of direct materials and additional direct labor of $6,500 to finish the job in October.The company applies overhead at the end of each month at a rate of 200% of the direct labor cost incurred. -What is the balance in the Work in Process account at the end of September relative to Job A3B?

Booth Manufacturing uses a job order costing system that charges overhead to jobs on the basis of direct material cost.At year-end,the Work in Process Inventory account shows the following. a.Determine the predetermined overhead rate used. b.Only one job remained in process at December 31.Its direct materials cost is $60,000.How much direct labor cost and overhead cost are assigned to it?

The predetermined overhead rate is revised many times during the period to compensate for inaccurate estimates previously made.