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Exam 27: Job Order Cost Accounting

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Question 31

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When perpetual inventories are maintained in a job order cost system, as each job is completed its cost is transferred from Work in Process Inventory to Finished Goods Inventory.

A) True
B) False

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Question 32

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Based on the information given: 1. Determine the overhead rate for Davit Boat Building; 2. Prepare the journal entry to apply manufacturing overhead to manufacturing process for the month of November; 3. Determine the balance in the Work in Process account. 1. The overhead application rate for the current year is 1.5 times direct labor cost. (367,500/245,000) 2.

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3. The balance in t...

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Question 33

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Standard cost accounting may be used with either a job order cost system or a process cost system.

Martinez Manufacturing applies overhead based on direct labor hours. The company estimates that their overhead for the year will be $180,000, and that they will use 72,000 direct labor hours. Martinez Manufacturing actually used 75,000 direct labor hours. The journal entry to record manufacturing overhead would include a:

Martinez Manufacturing applies overhead based on direct labor hours. The company estimates that their overhead for the year will be $180,000, and that they will use 72,000 direct labor hours. During the year, Martinez Manufacturing actually used 75,000 direct labor hours and actual overhead costs were $190,000. At the end of the year, manufacturing overhead was:

A firm purchased 50 units of materials with a unit price of $1.30 on June 1. On June 15, the firm purchased 50 units with a unit price of $1.20. If the firm uses the LIFO method of inventory pricing, the total cost of 65 units issued on June 20 would be

Morion Hat Manufacturing made the following charge purchases on February 4 of the current year. Felt $5,687; Ribbon $1,234; Straw $6,723; Dye (for the straw) $39; Thread $47; Various plastic fruits, flowers, etc. $179; and Glue $28. Assume that all items purchased were requisitioned for production during the year. Complete one journal entry for all purchases and one summary journal entry dated February 20 for the requisitioning of those materials into production. Also, explain the internal controls applied to safeguard raw materials. Note: Only the dye, glue, and thread are considered overhead. Some students may put the various plastic fruits, flower, etc. into indirect materials. If so the direct material would be $13,644 and the total for indirect materials would be $293.

A(n) ____________________ cost accounting system is normally used when standard types of products are made in continuous operations.

The entry to record applied overhead includes a(n) ____________________ to Manufacturing Overhead Applied.

Prepare a partial income statement for the month. Adjust the cost of goods sold for the amount of any overapplied or underapplied overhead.

The Manufacturing Overhead Applied account for Cullverin Manufacturing had activity of $860 in indirect materials and supplies, $992 in indirect labor, and $4,654 in other overhead costs recorded in the account at April 30 of the current year. The Manufacturing Overhead Applied account had a total of $6,740 in overhead applied during April. What is the over-or underapplied overhead for April? Prepare the journal entry to close the related overhead accounts.

Actual overhead costs are

Under a job order cost system, unit costs are determined for products manufactured under each ___________________.

Briefly describe a Just-in-Time (JIT) system. List the advantages and disadvantages of a JIT system.

List the four manufacturing operations and define each. For the second operation, Production, summarize the flow of costs through a job order cost accounting system.

At the end of the year, Harding Company had a balance in Manufacturing Overhead of $19,000, and a balance in Manufacturing Overhead Applied of $20,000. When the Manufacturing Overhead account is closed, the Cost of Goods Sold account will be:

How often are direct labor costs entered on the Job Order Cost Sheets?

The entry to record applied overhead includes a(n) ____________________ to the Work in Process Inventory account.

Under the LIFO method of inventory pricing, the quantities issued are priced from the oldest inventory items available in the order they were received.

A firm purchased 25 units of materials with a unit price of $2.00 on May 5. On May 15, the firm purchased 25 units with a unit price of $2.10. If the firm uses the FIFO method of inventory pricing, the total cost of 30 units issued on May 20 would be