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Exam 19: Job Order Costing

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Question 71

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Job order cost accounting systems may be used to evaluate a company's efficiency.

A) True
B) False

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Question 72

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Match each of the following phrases with the term (a-e) that it most closely describes it. Each term will be used only once. -Prepared when materials that have been ordered are received and inspected

A) Job cost sheets
B) Materials requisitions
C) Receiving report
D) Time tickets
E) Cost allocation

F) None of the above
G) D) and E)

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Question 73

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Use the information below for Adams Company to answer the questions that follow. ​ Adams Company is a manufacturing company that has worked on several production jobs during the first quarter of the year. Below is a list of all the jobs for the quarter: ​ ​ Jobs 356, 357, 358, and 359 were completed. Jobs 356 and 357 were sold at a profit of $500 on each job. -What is the ending balance of Cost of Goods Sold for Adams Company at the end of the first quarter?

Recording jobs shipped and customers billed would include a debit to

The balance of Material Q on May 1 and the receipts and issuances during May are as follows:? $\begin{array}{lr}\text { Balance, May } 1 & 8 \text { at } \$ 32 \\\text { Received, May } 11 & 23 \text { at } \$ 33 \\\text { Received, May } 25 & 15 \text { at } \$ 35\\\\\text { Issued, May } 17 & 14 \\\text { Issued, May } 27 & 18\end{array}$ Determine the cost of each of the issuances under a perpetual system, using the FIFO method.

The following account appears in the ledger after only part of the postings have been completed for July, the first month of the current fiscal year:? Factory overhead is applied to jobs at the rate of 60% of direct labor cost. The actual factory overhead incurred for July was $75,000. Jobs completed during the month totaled $301,200. (a)Prepare the journal entries to record (1) the application of factory overhead to production during July and (2) the jobs completed during July. (b)What is the balance of the factory overhead account on July 31? (c)Was factory overhead over- or underapplied on July 31? (d)Determine the balance of Work in Process on July 31.

Winston Company estimates that the factory overhead for the following year will be $1,250,000. The company has decided that the basis for applying factory overhead should be machine hours, which is estimated to be 50,000 hours. The total machine hours for the year were 54,300 hours. The actual factory overhead for the year was $1,348,800.​ (a)Determine the total factory overhead amount applied. (b)Calculate the over- or underapplied amount for the year. (c)Prepare the journal entry to close Factory Overhead into Cost of Goods Sold.

The source document for the data for debiting Work in Process for direct materials is a

All of the following are examples of activity bases except

Which of the following would most likely use a job order costing system?

As product costs are incurred in the manufacturing process, they are accounted for as assets and reported on the balance sheet as inventory.

The journal entry to record the purchase of $45,000 of raw materials is

A separate account for each material is found in a

Information about costs developed through a job order cost system cannot be used to evaluate an organization's cost performance.

Cranston Company estimates the following overhead costs for the coming year:​​ $\begin{array}{lr}\text { Equipment depreciation } & \$ 160,000 \\\text { Equipment maintenance } & 60,000 \\\text { Supervisory salaries } & 40,000 \\\text { Factory rent } & 100,000 \\\text { Total } & \mathbf{\$ 36 0 , 0 0 0} \\\end{array}$ Cranston is also budgeting $600,000 in direct labor costs and 15,000 machine hours for the coming year.​ (a)Calculate the predetermined overhead rate using direct labor costs as the allocation base. (b)Calculate the predetermined overhead rate using machine hours as the allocation base.

On November 2, Newsprint Manufacturing purchases 5 rolls of paper on account at $125 per roll for use within the production process. On November 5, 4 rolls of this paper are issued to Job 157A in the Printing Department. The Printing Department records $675 in direct labor and $1,150 of factory overhead to Job 157A. On November 8, Printing transfers Job 157A to the Folding Department. The Folding Department applies $450 in direct labor and $655 in factory overhead to Job 157A. Job 157A is transferred to finished goods inventory on November 9. (a)Journalize the purchase of the paper. (b)Journalize the transfer of raw materials to work in process, the application of direct labor, and the application of manufacturing overhead to Job 157A while in the Printing Department. (c)Journalize the transfer of Job 157A to the Folding Department at actual cost. (d)Journalize the application of direct labor and the application of manufacturing overhead to Job 157A while in the Folding Department. (e)Journalize the transfer of Job 157A to finished goods inventory at actual cost.

Which of the following is a period cost?

For a manufacturing business, products that are in the process of being manufactured are referred to as

Costs that are treated as assets until the product is sold are

A job order cost accounting system provides for a separate record of the cost of each particular quantity of product that passes through the factory.