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Exam 3: Job-Order Costing: Cost Flows and External Reporting

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Question 121

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The following accounts are from last year's books at Sharp Manufacturing: Sharp uses job-order costing and applies manufacturing overhead to jobs based on direct labor costs. What is the manufacturing overhead overapplied or underapplied for the year?

A) $6,000 underapplied
B) $6,000 overapplied
C) $26,000 underapplied
D) $26,000 overapplied

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

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Question 122

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Matthias Corporation has provided data concerning the Corporation's Manufacturing Overhead account for the month of May. Prior to the closing of the overapplied or underapplied balance to Cost of Goods Sold, the total of the debits to the Manufacturing Overhead account was $65,000 and the total of the credits to the account was $93,000. Which of the following statements is true?

A) Manufacturing overhead applied to Work in Process for the month was $93,000.
B) Manufacturing overhead for the month was underapplied by $28,000.
C) Manufacturing overhead transferred from Finished Goods to Cost of Goods Sold during the month was $65,000.
D) Actual manufacturing overhead incurred during the month was $93,000.

E) None of the above
F) A) and B)

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Question 123

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Crich Corporation uses direct labor-hours in its predetermined overhead rate. At the beginning of the year, the estimated direct labor-hours were 22,180 hours and the total estimated manufacturing overhead was $589,988. At the end of the year, actual direct labor-hours for the year were 22,150 hours and the actual manufacturing overhead for the year was $589,988. Overhead at the end of the year was: (Do not round intermediate calculations.)

Janeway Corporation uses a job-order costing system and has provided the following partially completed T-account summary for the past year. Required: What was the cost of raw materials requisitioned for use in production during the year?

Beshaw Incorporated has provided the following data for the month of January. There were no beginning inventories; consequently, the direct materials, direct labor, and manufacturing overhead applied listed below are all for the current month. Manufacturing overhead for the month was underapplied by $7,000.The Corporation allocates any underapplied or overapplied manufacturing overhead among work in process, finished goods, and cost of goods sold at the end of the month on the basis of the manufacturing overhead applied during the month in those accounts.The cost of goods sold for January after allocation of any underapplied or overapplied manufacturing overhead for the month is closest to:

Weatherhead Incorporated has provided the following data for the month of March. There were no beginning inventories; consequently, the direct materials, direct labor, and manufacturing overhead applied listed below are all for the current month. Manufacturing overhead for the month was overapplied by $4,000. The Corporation allocates any underapplied or overapplied manufacturing overhead among work in process, finished goods, and cost of goods sold at the end of the month on the basis of the manufacturing overhead applied during the month in those accounts. The work in process inventory at the end of March after allocation of any underapplied or overapplied manufacturing overhead for the month is closest to: (Round intermediate percentage computations to the nearest whole percent.)

In the Schedule of Cost of Goods Sold, Cost of goods available for sale = Ending finished goods inventory + Cost of goods manufactured.

On November 1, Arvelo Corporation had $32,000 of raw materials on hand. During the month, the company purchased an additional $78,000 of raw materials. During November, $95,000 of raw materials were requisitioned from the storeroom for use in production. These raw materials included both direct and indirect materials. The indirect materials totaled $3,000. Prepare journal entries to record these events. Use those journal entries to answer the following questions:The debits entered in the Raw Materials account during the month of November total:

Entry (4) in the below T-account could represent the cost of property taxes and insurance incurred on the factory.

Heathcote Corporation is a manufacturer that uses job-order costing. The company closes out any overapplied or underapplied overhead to Cost of Goods Sold at the end of the year. The company has supplied the following data for the just completed year: Results of operations: The adjusted Cost of Goods Sold for the year is:

Vogel Corporation's cost of goods manufactured last month was $136,000. The beginning finished goods inventory was $35,000 and the ending finished goods inventory was $48,000. Overhead was overapplied by $6,000. Any underapplied or overapplied manufacturing overhead is closed out to cost of goods sold.How much is the cost of goods available for sale on the Schedule of Cost of Goods Sold?

Bayest Manufacturing Corporation uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. Last year, the Corporation worked 58,250 actual direct labor-hours and incurred $442,000 of actual manufacturing overhead cost. The Corporation had estimated that it would work 60,900 direct labor-hours during the year and incur $389,760 of manufacturing overhead cost. The Corporation's manufacturing overhead cost for the year was:

Overapplied manufacturing overhead would result if:

The entire difference between the actual manufacturing overhead cost for a period and the applied manufacturing overhead cost is typically closed to the Work In Process account.

On January 1, Schaf Corporation had $23,000 of raw materials on hand. During the month, the company purchased an additional $54,000 of raw materials. During January, $50,000 of raw materials were requisitioned from the storeroom for use in production. These raw materials included both direct and indirect materials. The indirect materials totaled $6,000.The journal entry to record the requisition from the storeroom would include a:

Koczela Incorporated has provided the following data for the month of May: Inventories: Additional information: Any underapplied or overapplied manufacturing overhead is closed out to cost of goods sold.The cost of goods manufactured for May is:

Luebke Incorporated has provided the following data for the month of November. The balance in the Finished Goods inventory account at the beginning of the month was $52,000 and at the end of the month was $30,000. The cost of goods manufactured for the month was $212,000. The actual manufacturing overhead cost incurred was $55,000 and the manufacturing overhead cost applied to Work in Process was $58,000. The company closes out any underapplied or overapplied manufacturing overhead to cost of goods sold. The adjusted cost of goods sold that would appear on the income statement for November is:

Dacosta Corporation had only one job in process on May 1. The job had been charged with $2,100 of direct materials, $6,966 of direct labor, and $10,020 of manufacturing overhead cost. The company assigns overhead cost to jobs using the predetermined overhead rate of $19.00 per direct labor-hour.During May, the following activity was recorded: Work in process inventory on May 30 contains $3,795 of direct labor cost. Raw materials consist solely of items that are classified as direct materials.The cost of goods manufactured for May was:

Dotsero Technology, Inc., has a job-order costing system. The company uses predetermined overhead rates in applying manufacturing overhead cost to individual jobs. The predetermined overhead rate in Department A is based on machine-hours, and the rate in Department B is based on direct materials cost. At the beginning of the most recent year, the company's management made the following estimates for the year: Job 243 entered into production an April 1 and was completed on May 12. The company's cost records show the following information about the job: At the end of the year, the records of Dotsero showed the following actual cost and operating data for all jobs worked on during the year: Required: a. Compute the predetermined overhead rates for Department A and Department B. b. Compute the total overhead cost applied to Job 243. c. Compute the amount of underapplied or overapplied overhead in each department at the end of the current year.

Rediger Incorporated a manufacturing Corporation, has provided the following data for the month of June. The balance in the Work in Process inventory account was $36,000 at the beginning of the month and $24,000 at the end of the month. During the month, the Corporation incurred direct materials cost of $57,800 and direct labor cost of $32,200. The actual manufacturing overhead cost incurred was $54,400. The manufacturing overhead cost applied to Work in Process was $53,800. The cost of goods manufactured for June was: