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MULTIPLE CHOICE QUESTIONS               36.Which of the following is one of the components of cost accounting? a.It involves measuring product costs. b.It involves the determination of company profits. c.It requires GAAP to be applied. d.It requires cost minimizing principles.               37.A major purpose of cost accounting is to a.classify all costs as operating or nonoperating. b.measure, record, and.
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              11.Manufacturing costs are generally incurred in one period and recorded in a subsequent period.               12.The Purchases account is credited for all raw materials purchase returns and allowances. 13.When raw materials are received, there no effort at this point to associate the cost of materials with specific jobs.               14.When raw materials.
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              21.When equivalent units of production are different for materials and conversion costs, unit costs are computed for materials, conversion, and total manufacturing.               22.The total manufacturing cost per unit is used in costing the units completed and transferred during the period.               23.A production cost report is an internal document for.
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SHORT-ANSWER ESSAY QUESTIONS S-A E  200 (a) Distinguish between the two types of cost accounting systems. (b) May a company use both types of cost accounting systems? S-A E  201 A job order cost accounting system is fully integrated into the general ledger of a company. Identify the major general ledger accounts used in.
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              56.Grape Industries has the following labor costs: Factory—Gross wages$390,000 Factory—Net wages320,000 Employer Payroll Taxes Payable50,000 The entry to record the cost of factory labor and the associated payroll tax expense will include a debit to Factory Labor for a.$440,000. b.$390,000. c.$370,000. d.$340,000.               57.Factory labor costs a.accumulate in advance of utilization. b.accumulate in a control account. c.include sick pay earned by.
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Ex. 180 Finn Kirk and Co., a CPA firm, uses job order costing to capture the costs of its audit jobs. There were no audit jobs in process at the beginning of November. Listed below are data concerning the three audit jobs conducted during November. SunderGrandShort Direct materials$900$600$300 Auditor labor costs$5,900$6,600$3,700 Auditor hours728845 Overhead costs are.
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MATCHING 201.Match the items in the two columns below by entering the appropriate code letter in the space provided. A.Managerial accounting F.Work in process inventory B.Financial accounting G.Direct materials C.Planning H.Manufacturing overhead D.DirectingI. Period costs E.Controlling J.Value chain _____              1.The cost of products that are partially complete. _____              2.The function of keeping activities in accordance with plans. _____              3.Primarily.
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Ex. 173 Pink Pony Manufacturing Company employs a job order cost accounting system and keeps perpetual inventory records. The following transactions occurred in the first month of operations: 1.Direct materials requisitioned during the month: Job 101$22,000 Job 10216,000 Job 103  24,000 $62,000 2.Direct labor incurred and charged to jobs during the month was: Job 101$30,000 Job 10226,000 Job 103  20,000 $76,000 3.Manufacturing.
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S-A E  208(Communication) Audiofile, a producer of audio equipment for large computer systems, is reviewing its policies as part of a biannual self-examination of the company. As part of this process, all managers have been asked to carefully examine costs and determine as closely as possible which costs are direct and.
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Ex. 181 Fill in the missing information on the cost of goods manufactured schedule of Fire Tool Manufacturing Company: FIRE TOOL MANUFACTURING COMPANY Cost of Goods Manufactured Schedule For the Year Ended December 31, 2012 Work in process (1/1)$320,000 Direct materials Raw materials inventory (1/1)$       ? Raw materials purchases  246,000 Raw materials available for use          ? Raw materials inventory (12/31)    37,000 Direct.
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TRUE-FALSE STATEMENTS               1.Cost accounting is primarily concerned with accumulating information about product costs.               2.A job order cost system is most appropriate when a large volume of uniform products are produced.               3.A process cost accounting system is appropriate for similar products that are continuously mass produced.               4.The perpetual inventory method cannot.
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Ex. 168 Manufacturing cost data for Best Industries, which uses a job order cost system, are presented below: Case A Case B Direct Materials Used(a)$103,000 Direct Labor$  70,000140,000 Manufacturing Overhead Applied63,000(d) Total Manufacturing Costs240,000(e) Work in Process, 1/1/12(b)45,000 Total Cost of Work in Process300,000(f) Work in Process, 12/31/12(c)40,000 Cost of Goods Manufactured205,000(g) Instructions Indicate the missing amount for each letter. Assume.
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Ex. 176 Blue Light Company allocates manufacturing overhead at $9 per direct labor hour. Job A45 required 5 boxes of direct materials at a cost of $30 per box and took employees 12 hours to complete. Employees earn $15 per hour. Instructions Compute the total cost of Job A45. Ex. 177 Job cost sheets for.
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76.The following information is available for completed Job No. 402: Direct materials, $80,000; direct labor, $120,000; manufacturing overhead applied, $60,000; units produced, 5,000 units; units sold, 4,000 units. The cost of the finished goods on hand from this job is a.$40,000. b.$260,000. c.$52,000. d.$208,000. 77.Yellow Manufacturing completed Job No. B14 during 2012. The job cost.
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              66.A copy of the materials requisition slip would not include the: a.quantity. b.stock number. c.cost per unit. d.name of the supplier.               67.Materials requisition slips are costed a.by production supervisors. b.by factory personnel who work on the production line. c.after the goods have been sold. d.using any of the inventory costing methods.               68.Postings to control accounts in a.
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Ex. 170 Blue Moon Company reported the following amounts for 2012: Raw materials purchased$98,000 Beginning raw materials inventory5,200 Ending raw materials inventory4,500 Beginning finished goods inventory7,600 Ending finished goods inventory8,000 Direct labor used25,000 Manufacturing overhead costs applied30,000 Beginning work in process inventory6,100 Ending work in process inventory6,300 Ex. 170(Cont.) Instructions Calculate (a) the cost of materials used in production and (b) total manufacturing.
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Ex. 184 Indicate whether each of the following would appear on the: A—Cost of goods manufactured schedule B—Income statement C—Balance sheet Note: If it would appear in more than just one, indicate which ones. ______ 1. Cost of goods sold ______ 2. Finished goods inventory, 12/31 ______ 3. Direct materials used ______ 4. Raw materials inventory, 1/1 ______ 5. Insurance.
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              48.Which of the following manufacturing cost elements occurs in a process cost system? a.Direct materials. b.Direct labor. c.Manufacturing overhead. d.All of these.               49.In a process cost system, product costs are summarized: a.on job cost sheets. b.on production cost reports. c.after each unit is produced. d.when the products are sold.               50.When manufacturing overhead costs are assigned to production.
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116.Tablets Company had the following information at December 31: Finished goods inventory, January 1$  30,000 Finished goods inventory, December 3190,000 If the cost of goods manufactured during the year amounted to $1,260,000 and annual sales were $1,650,000, the amount of gross profit for the year is a.$390,000. b.$1,200,000. c.$450,000. d.$330,000. 117.Concrete International Industries incurred direct materials costs of.
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Ex. 174 Agave Manufacturing is a small manufacturer that uses machine-hours as its activity base for assigned overhead costs to jobs. The company estimated the following amounts for 2012 for the company and for Job 62: Company Job 62  Direct materials$60,000$4,500 Direct labor$25,000$2,500 Manufacturing overhead costs$72,000 Machine hours90,0001,350 During 2012, the actual machine-hours totaled 94,000,.
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              86.Sun Screen Manufacturers applies overhead on the basis of 120% of direct labor cost. Job No. 190 is charged with $80,000 of direct materials costs and $120,000 of manufacturing overhead. The total manufacturing costs for Job No. 190 is a.$200,000. b.$344,000. c.$216,000. d.$300,000.               87.Peralta Company manufactures customized desks. The following pertains to Job.
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Ex. 180 Manufacturing costs for Cassandra Company for selected months are as follows:    April      July  October Beginning work in process$  80,000(f)$ 98,000 Direct materials used280,000$190,000155,000 Direct labor195,000170,000(j) Manufacturing overhead(a)150,00090,000 Total manufacturing costs870,000510,000430,000 Total cost of work in process(b)640,000(k) Ending work in process75,000(g)(l) Cost of goods manufactured(c)505,000385,000 Beginning finished goods(d)38,000(m) Cost of goods available for sale960,000(h)480,000 Ending finished goods(e)75,000(n) Cost of goods sold820,000(i)355,000 Instructions Indicate the missing.
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              96.Manufacturing overhead applied is added to direct labor incurred and to what other item to equal total manufacturing costs for the period? a.Goods available for sale. b.Raw materials purchased. c.Work in process. d.Direct materials used.               97.Brothers Manufacturing applies overhead to production at a predetermined rate of 90% based on direct labor cost. Job.
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Ex. 178 Broad Reach Engineering Company begins operations on July 1, 2012. Information from job cost sheets shows the following: Manufacturing Costs Assigned Job No.    July  AugustSeptember 100$12,000$8,800 1017,8009,700$12,000 1025,000 10311,8006,000 1045,8007,000 Job 102 was completed in July. Job 100 was completed in August, and Jobs 101 and 103 were completed in September. Each job was sold for 60% above.
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              11. A primary driver of overhead costs in continuous manufacturing operations is machine time used.               12.Equivalent units of production are used to determine the cost per unit of completed products.               13.Equivalent units of production measure the work done during a period, expressed in fully completed units.               14.Equivalent units of.
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136.If manufacturing overhead has been underapplied during the year, the adjusting entry at the end of the year will show a a.debit to Manufacturing Overhead. b.credit to Cost of Goods Sold. c.debit to Work in Process Inventory. d.debit to Cost of Goods Sold.               137.If manufacturing overhead has been overapplied during the year, the adjusting.
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COMPLETION STATEMENTS               186.Financial accounting information is prepared mainly for ______________ users, while managerial accounting information is prepared primarily for ______________ users.               187.The types of reports prepared in managerial accounting are often ______________-purpose reports prepared for a specific decision.               188.Managerial accounting reports generally pertain to ______________ of a business and may.
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MULTIPLE CHOICE QUESTIONS               38.A process cost accounting system is most appropriate when a.a variety of different products are produced, each one requiring different types of materials, labor, and overhead. b.the focus of attention is on a particular job or order. c.similar products are mass-produced. d.individual products are custom made to the specification of customers.              .
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MATCHING 199.Match the items in the two columns below by entering the appropriate code letter in the space provided.               A.Cost accounting              F.              Process cost system               B.Materials requisition slip              G.              Job cost sheets               C.Time ticket              H.              Predetermined overhead rate               D.Cost accounting system              I.              Overapplied overhead               E.Job order cost system              J.              Underapplied overhead _____             .
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              21.There should be a separate job cost sheet for each job.               22.Actual manufacturing overhead costs are assigned to each job by tracing each overhead cost to a specific job.               23.The formula for the predetermined overhead rate is estimated annual overhead costs divided by an expected annual operating activity.               24.Actual.
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Ex. 188 The following information is available for Bailey Company at December 31, 2012: 1.Inventory balanceBeginning of YearEnd of Year Finished Goods$14,000$10,000 Work in Process6,00012,000 Raw Materials10,3006,500 2.Debit postings to Work in Process Inventory during the year were: Direct materials$80,000 Direct labor50,000 Manufacturing overhead applied75,000 3.Sales totaled $310,000 for the year. Instructions (a)Prepare a condensed cost of goods manufactured schedule. (b)Prepare an income.
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Ex. 164 Selected accounts of Burnt Orange Manufacturing Company at year end appear below: RAW MATERIALS INVENTORYWORK IN PROCESS INVENTORY (a)40,000(d)25,000(d)25,000(g)140,000 (e)80,000 (f)100,000 FINISHED GOODS INVENTORYCOST OF GOODS SOLD (g)140,000(h)120,000(h)120,000 FACTORY LABORMANUFACTURING OVERHEAD (b)110,000(e)110,000(c)75,000(f)100,000 (e)30,000 Instructions Explain the probable transaction that took place for each of the items identified by letters in the accounts. For example: (a)Raw materials costing $40,000 were purchased. Ex. 165 Gourmet.
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              46.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.               47.When a job is completed and all costs have been accumulated on a job cost sheet, the journal entry that should be made is a.Finished Goods Inventory Direct Materials Direct Labor Manufacturing Overhead b.Work In.
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              31.In continuous process manufacturing, generally once the production begins, it continues until the finished product emerges.               32.One similarity of process cost accounting with job order cost accounting is that both determine total manufacturing costs after each job.               33.The flow of costs in a process costing system requires that materials.
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Ex. 187 Heart Manufacturing Company makes specialty tools. In January, Heart incurs manufacturing costs of $10,000,000 for direct materials, direct labor, and overhead. 20% of the total costs represents overhead applied. The overhead rate is $1 for every $2 of direct labor costs incurred. Inventory balances were: January 1January 31 Raw materials$300,000$500,000 Work in.
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BE 157 The manufacturing operations of Rowen, Inc. had the following balances for the month of January: InventoriesJanuary 1January 31 Raw materials$12,000$13,000 Work in process21,00023,000 Finished goods14,00016,000 Rowen transferred $250,000 of completed goods out of work in process during January. Instructions Compute the cost of goods sold. BE 158 The following amounts were reported by Adam Company before adjusting.
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              68.In the month of June, a department had 12,000 units in beginning work in process that were 70% complete. During June, 48,000 units were transferred into production from another department. At the end of June there were 6,000 units in ending work in process that were 40% complete. Materials.
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SHORT-ANSWER ESSAY QUESTIONS S-A E  202 Financial and managerial accounting are both concerned with the economic events of an enterprise. Similarities between financial and managerial accounting do exist, but they do have a different focus. Briefly distinguish between financial and managerial accounting as they relate to (1) the primary users, (2) the.
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S-A E  204(Ethics) People Carrier Systems, Inc. (PCS) modifies vans that seat 15–20 people by adding additional safety features or wheelchair ramps. Most of its customers are cities and counties, who use the vans to transport school children, the elderly, or the handicapped. The company has specialized in a no-frills approach,.
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  BRIEF Exercises BE 151 During the first year of operations, Stick Industries accumulated the following manufacturing costs: Raw materials purchased on account$9,000 Factory labor accrued6,000 Incurred manufacturing overhead on account3,000 Instructions Prepare separate journal entries for each manufacturing cost. BE 152 In January, Bread, Inc. production supervisor requisitioned raw materials for production as follows: Job 1 $600,.
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126.Sofa Manufacturers applies overhead on the basis of machine hours. Given the following data, compute overhead applied and the under- or overapplication of overhead for the period: Estimated annual overhead cost$1,500,000 Actual annual overhead cost$1,470,000 Estimated machine hours300,000 Actual machine hours290,000 a.$1,450,000 applied and $20,000 overapplied b.$1,500,000 applied and $20,000 overapplied c.$1,450,000 applied and $20,000 underapplied d.$1,470,000 applied.
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Ex. 163 Six Feathers Manufacturing Company uses a job order cost accounting system and keeps perpetual inventory records. Prepare journal entries to record the following transactions during the month of June. June1Purchased raw materials for $20,000 on account. 8Raw materials requisitioned by production: Direct materials$8,000 Indirect materials1,000 15Paid factory utilities, $2,100 and repairs for factory equipment,.
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COMPLETION STATEMENTS               189.Cost accounting involves the measuring, recording, and reporting of ______________ costs.               190.There are two basic types of cost accounting systems: (1)__________________ system, and (2)__________________ system.               191.A ______________ cost system is appropriate when similar products are continuously produced, whereas a ______________ cost system would be more appropriate if the.
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Ex. 185 Contessa Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead costs are expected to total $1,200,000 for the year, and machine usage is estimated at 200,000 hours. In January, $128,000 of overhead costs are incurred and 22,000 machine hours are used. For the remainder of.
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              58.A process with no beginning work in process, completed and transferred out 75,000 units during a period and had 50,000 units in the ending work in process inventory that were 30% complete. The equivalent units of production for the period were: a.75,000 equivalent units. b.125,000 equivalent units. c.90,000 equivalent units. d.37,500 equivalent units.              .
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TRUE-FALSE STATEMENTS               1.Process cost accounting focuses on the process involved in mass-producing products that are very similar in nature.               2.Process cost systems are used to apply costs to a specific job, such as the manufacturing of a specialized machine.               3.A company that produces motion pictures would likely use a process.
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106.During 2012, Pappy Company expected Job No. 26 to cost $300,000 of overhead, $500,000 of materials, and $200,000 in labor. Tanner applied overhead based on direct labor cost. Actual production required an overhead cost of $560,000, $550,000 in materials used, and $220,000 in labor. All of the goods were completed..
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Ex. 166 The gross earnings of factory workers for Javelin Manufacturing Company during the month of January are $300,000. The employer's payroll taxes for the factory payroll are $36,000. Of the total accumulated cost of factory labor, 75% is related to direct labor and 25% is attributable to indirect labor. Instructions (a)Prepare the.
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