Accounting Expert Answers & Study Resources : Page 105

11) Manufacturing Overhead is a temporary account used to ________ indirect production costs during the accounting period. A) allocate B) assign C) accumulate D) approximate 12) The journal entry to issue indirect materials to production should include a debit to the ________. A) Finished Goods Inventory account B) Raw Materials Inventory account C) Manufacturing Overhead account D) Work-in-Process Inventory.

21) The Assembly Department of Smart Inc., manufacturer of computers, incurred $250,000 in direct materials and $75,000 in conversion costs. The equivalent units of production for direct materials and conversion costs are 1,000 and 800, respectively. The cost per equivalent unit of production (EUP) for conversion costs is ________. A) $93.75.

21) On June 30, Cleopatra Inc. finished Job 70 with total job costs of $40,000 and transferred the costs to Finished Goods Inventory. On July 6, Cleopatra completed the sale of the goods to a customer for $55,000 on account. Provide the entry to record the cost of goods sold. .

Learning Objective 17-5 1) Manufacturing overhead costs allocated to a job amounted to $492,000. The actual manufacturing costs incurred during the year was $500,000. Overhead costs have been underallocated. 2) During 2015, a company incurred $500,000 of manufacturing overhead costs and allocated $506,000 of manufacturing overhead costs. At the year-end, the adjustment.

11) An activity-based costing system is developed in four steps. a. Compute the allocation rate for each activity. b. Identify activities and estimate their total costs. c. Identify the cost driver for each activity and then estimate the quantity of each driver's allocation base. d. Allocate the indirect costs to the cost object. Which of.

31) Best Inc., a merchandiser, sells office supplies. The following information summarizes Best's operating activities during 2015: Utilities Expense $6,000 Rent for Store Expense 8,000 Sales Commissions Expense 4,500 Purchases of Merchandise 54,000 Inventory on January 1, 2015 30,000 Inventory on December 31, 2015 20,500 Sales Revenue 108,000 Required: Prepare an income statement for Best Inc. for the year ended December 31, 2015, using the.

Learning Objective 17-3 1) Actual manufacturing overhead costs are credited to the Manufacturing Overhead account. 2) In a manufacturing operation, depreciation of plant equipment should be debited to the Depreciation Expense account. 3) Manufacturing overhead costs are allocated to the Work-in-Process Inventory account by a debit to the Manufacturing Overhead account. 4) The amount.

Learning Objective 17-2 1) When raw materials are requisitioned for a job, the Raw Materials Inventory account is debited. 2) Work-in-Process Inventory is debited when indirect labor costs are incurred in a job order costing system. 3) When direct materials are received on the production floor, they are recorded on the job cost.

41) Davie Inc. used estimated direct labor hours of 250,000 and estimated manufacturing overhead costs of $1,000,000 in establishing its 2015 predetermined overhead allocation rate. Actual results showed: Actual manufacturing overhead $900,000 Allocated manufacturing overhead $875,000 What was the number of direct labor hours worked during 2015? A) 225,000 hours B) 243,056 hours C) 250,000 hours D) 218,750 hours 42).

Learning Objective 18-1 1) A process costing system is most suitable for businesses that manufacture batches of unique products or provide specialized services. 2) In a process costing system, each process or department has its own Work-in-Process Inventory account. 3) A textile manufacturing company is most likely to use job order costing to.

11) Jasper Inc. reports the following cost information for March: Cost of Goods Manufactured $75,000 Manufacturing Overhead 18,250 Finished Goods Inventory, March 1 4,500 Finished Goods Inventory, March 31 2,650 Work-in-Process Inventory, March 1 9,670 Work-in-Process Inventory, March 31 1,250 Direct Materials Used 25,300 What is the cost of goods sold for March? A) $83,420 B) $73,150 C) $76,850 D) $82,150 12) Jasper Inc. reports the following cost information for.

11) LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments—Mixing, Refining, and Packaging. On January 1, 2014, the first department—Mixing—had no beginning inventory. During January, 40,000 fl. oz. of chemicals were started in production. Of these, 32,000 fl. oz. were completed and 8,000 fl..

31) Venus Manufacturing uses a predetermined overhead allocation rate based on percentage of direct labor cost. At the beginning of the year, it fixed the manufacturing overhead rate at 20% times the direct labor cost. In the month of June, Venus completed Job 13C and its details are as follows: Direct.

Learning Objective 16-4 1) The cost of goods manufactured includes selling expenses, administrative expenses, and manufacturing overhead. 2) Merchandiser's inventory consists of raw materials inventory, work-in-process inventory, and finished goods inventory. 3) Total manufacturing costs to account for during the year minus the ending work-in-process inventory equals the cost of goods manufactured. 4) Which.

28) Amber Corporation has provided the following information of its operating activities for 2015: Merchandise Inventory, January 1, 2015 $150,000 Merchandise Inventory, December 31, 2015 75,000 Purchases 854,000 Selling and Administrative Expenses 65,000 Sales Revenue 1,000,000 Required: Prepare Amber's income statement for the year ended December 31, 2015. Use the format provided below: Sales Revenue Cost of Goods Sold     Beginning Inventory     Purchases     Cost.

31) Which of the following is an example of a period cost for a manufacturing company? A) advertising expense B) depreciation on factory equipment C) indirect materials D) property taxes for the factory 32) Which of the following is a part of manufacturing overhead? A) cost of raw materials B) wages of assembly line workers C) factory insurance D).

11) Lakeside Inc. estimated manufacturing overhead costs for 2014 at $378,000, based on 180,000 estimated direct labor hours. Actual direct labor hours for 2014 totaled 195,000. The manufacturing overhead account contains debit entries totaling $391,500. The manufacturing overhead for 2014 was ________. (Round your intermediate calculations to one decimal place) A) $31,500.

11) A predetermined overhead allocation rate is used to allocate direct materials cost to various processes or departments. 12) The adjusting entry for overallocated or underallocated manufacturing overhead is usually prepared at the beginning of the accounting period. 13) The four-steps of tracking product costs in a process costing system are ________. A).

31) The activity-based costing system improves the allocation of ________. A) indirect manufacturing costs B) direct labor C) direct materials D) sales commissions 32) Which of the following would most likely be treated as an activity in an activity-based costing system? A) direct labor cost B) machine processing C) direct materials cost D) sales revenues 33) Ace Plastics produces different.

11) Neptune Accounting Services expects its accountants to work for 24,000 direct labor hours per year. The company's estimated total indirect costs are $240,000. The direct labor rate is $75 per hour. The company uses direct labor hours as the allocation base for indirect costs. If Neptune performs a job.

Learning Objective 16-5 1) Managerial accounting is used in manufacturing and merchandising companies, but not in service companies. 2) Service companies do not have product costs so they often consider all operating expenses as part of their cost of service. 3) Managerial accounting can be used to calculate costs for service and merchandising.

11) At the beginning of 2015, Conway Manufacturing had the following account balances: Following additional details are provided for the year: Direct materials placed in production $80,000 Direct labor incurred 190,000 Manufacturing overhead incurred 300,000 Manufacturing overhead allocated to production 295,000 Cost of jobs completed and transferred 500,000 The ending balance in the Work-in-Process Inventory account is a ________. A) credit of.

21) Alpha Company manufactures breadboxes and uses an activity-based costing system. The following information is provided for the month of May: Activity Estimated Indirect Activity Costs Allocation Base Estimated Quantity of Allocation Base Materials handling $3,500 Number of parts 5,000 parts Assembling $12,000 Number of parts 5,000 parts Packaging $5,750 Number of bread boxes 1,250 bread boxes Each breadbox consists of four parts, and the direct materials.

Learning Objective 19-1 1) Direct material costs and direct labor costs cannot be easily traced to products. Therefore, they are allocated to products. 2) Manufacturing overhead costs, which are also known as indirect costs, cannot be cost-effectively traced to products. 3) Predetermined overhead allocation rate is an estimated overhead cost per unit of.

21) On January 1, 2015, Frederic Manufacturing had a beginning balance in Work-in-Process Inventory of $160,000 and a beginning balance in Finished Goods Inventory of $20,000. During the year, Frederic incurred manufacturing costs of $200,000. During the year, the following transactions occurred: Job C-62 was completed for a total cost of $140,000.

Learning Objective 17-1 1) Accounting firms, building contractors, and healthcare providers use process costing. 2) A job order costing system is used by companies that manufacture batches of unique products or provide specialized services. 3) A process costing system is used when a company produces identical units through a series of production steps. 4).

Learning Objective 18-6 1) Production cost reports prepared using the first-in-first-out (FIFO) method, determines the cost of equivalent units of production by accounting for beginning inventory costs separately from current period costs. 2) Production cost reports prepared using first-in-first-out (FIFO) method assumes that the first units started in the production process.

Learning Objective 17-6 1) Dezire Travel Services provided the following information: Cost allocation rate for direct labor: $80 per hour Cost allocation rate for indirect costs: $15 per direct labor hour If Dezire receives $1,600 for a job requiring 8 hours of direct labor, then Dezire will make a profit of $440. 2) Dezire.

27) The Polishing Department of Laminates Inc. had 15,000 units in process on June 1, and received 25,000 units from the Machining Department. During the month, it completed 32,000 units and transferred them to the Packaging Department. Prepare the production cost report for the Polishing Department for the whole units.

Learning Objective 18-2 1) Under process costing, the unit cost of the completed units is less than the unit cost of the incomplete units. 2) At the end of an accounting period, the costs assigned to a production department can be split into the cost of units fully completed and transferred, and.

11) Which of the following is used to calculate the number of units accounted for under first-in-first-out (FIFO) method of inventory valuation of process costing? A) Accounted for = Beginning balance + Started and completed + In process B) Accounted for = Beginning balance + Started and completed C) Accounted for = Beginning.

21) Barricades Corporation provided the following information for the year 2015: Beginning Balance—Work-in-Process Inventory $24,000 Ending Balance—Work-in-Process Inventory 56,000 Beginning Balance—Raw Materials Inventory 84,000 Ending Balance—Raw Materials Inventory 60,000 Purchases—Raw Materials 360,000 Direct Labor 470,000 Indirect Materials 47,000 Indirect Labor 19,000 Depreciation on Factory Plant & Equipment 24,000 Plant Utilities & Insurance 270,000 What was the amount of direct materials used in production during 2015? A) $360,000 B) $504,000 C) $384,000 D) $328,000 22) Barricades Corporation.

21) The cost of units sold is recorded by debiting Cost of Goods Sold and crediting ________. A) Finished Goods Inventory B) Sales Revenue C) Work-in-Process Inventory D) Wages Payable 22) Jetwell Inc. incurred $7,000 for indirect labor in Department III. The journal entry to record indirect labor utilized is ________. A) debit Manufacturing Overhead, $7,000;.

21) Gardner Machine Shop estimates manufacturing overhead costs for the coming year at $316,000. The manufacturing overhead costs will be allocated based on direct labor hours. Gardner estimates 5,000 direct labor hours for the coming year. In January, Gardner completed Job A33, which used 60 machine hours and 15 direct.

Learning Objective 18-5 1) In a process costing system, costs can be controlled with the aid of a production cost report. 2) In most organizations, managers are often rewarded based on how well they meet the budget. 3) A production cost report cannot be used for the pricing of products as it depicts.

Learning Objective 18-4 1) When raw materials are purchased on account, the Accounts Payable account is credited. 2) The Raw Materials Inventory account is debited when direct materials are issued for production. 3) When indirect materials are issued to production, the Manufacturing Overhead account is credited. 4) When indirect materials are issued to production,.

51) Which of the following would be considered a product cost for a manufacturing business? A) research and development B) property taxes on the factory C) advertising D) delivery costs 52) Which of the following would be considered a product cost for a manufacturing business? A) salary of the sales manager B) salary of the CEO C) salaries.

31) Evanston Manufacturing Inc. reported the following information for the year 2015: Number of Units Produced 4,800 Number of Units Sold 5,250 Cost of Goods Manufactured $460,800 Cost of Goods Sold $488,250 Sales Revenue $1,260,000 Gross Profit $771,750 Operating Expense $724,900 What was the unit product cost? A) $87.77 B) $262.50 C) $93.00 D) $96.00 32) South State Inc. used $71,000 of direct materials and incurred $37,000 of direct labor.

11) Direct costs and indirect costs can be easily traced directly to a cost object. 12) In a manufacturing company, the salary of sales staff is an example of period cost. 13) Wages of factory janitors is considered non-manufacturing overhead as these are not directly related to the manufacturing process. 14) Indirect materials.

21) The Assembling Department of Mat Liners Inc. had 10,000 units in process in December beginning and received 30,000 units from the Sewing Department. During the month, it completed 20,000 units and transferred them to the Packaging Department. Calculate the number of units accounted for by the Assembling Department for.

Learning Objective 19-2 1) Activity-based costing focuses on a single predetermined overhead rate for cost analysis. 2) Traditional costing provides more detailed information on costs of activities and the drivers of these costs than activity-based costing. 3) Traditional costing systems employ multiple allocation rates, but an activity-based costing system uses only one rate.

11) Which of the following is a step in the preparation of a production cost report? A) assignment of costs to units completed and units in process B) summarization of the flow of physical units to the suppliers C) computation of expected units of production D) computation of amount of materials required for production 12).

Learning Objective 18-3 1) In a production cost report, the number of units to account for must always be greater than the number of units accounted for. 2) A production cost report shows only the calculations for the physical flow of products. 3) The task of summarizing the flow of physical units is.

41) Which of the following is a product cost? A) sales commissions B) CEO's salary C) delivery van depreciation D) depreciation on production equipment 42) Which of the following correctly describes the accounting for indirect labor costs? A) Indirect labor costs are product costs and are expensed as incurred. B) Indirect labor costs are period costs and.

29) Excellent Inc. sells accounting textbooks. The following information summarizes Excellent's operating activities for 2015: Merchandise Inventory, January 1, 2015 $10,000 Merchandise Inventory, December 31, 2015 7,000 Purchases 95,000 Selling and Administrative Expenses 65,000 Sales Revenue 180,000 Required: Prepare Excellent Inc. income statement for the year ended December 31, 2015. 30) Simons Inc. sells plasticware. The following information summarizes Simons' operating activities.

11) A process costing system is generally used by companies that produce homogeneous products. 12) Under a process costing system, product costs are accumulated with respect to jobs completed. 13) Under a process costing system, costs of completed products are transferred to the Finished Goods Inventory at the end of the accounting.

21) In a manufacturing company, advertising and marketing costs are included in manufacturing overhead. 22) In a manufacturing company, accounting, legal, and administrative costs are typical examples of product costs. 23) In a manufacturing company, administrative costs are included in period costs. 24) Repair and maintenance costs for factory equipment are product costs. 25).

Learning Objective 17-4 1) The cost of goods manufactured is recorded with a debit to the Work-in-Process Inventory account and a credit to the Cost of Goods Manufactured account. 2) The cost of goods manufactured is recorded with a debit to the Finished Goods Inventory account and a credit to the Work-in-Process.

Learning Objective 16-3 1) Product costs, such as factory overhead, should be treated as an asset until the product is sold. 2) Manufacturing overhead includes all manufacturing costs, such as direct labor and direct materials. 3) Manufacturing overhead includes indirect manufacturing costs, such as insurance and depreciation on the factory building. 4) All costs.

11) Which of the following will be debited to the Manufacturing Overhead account of a watch manufacturer? A) office telephone expenses B) salaries paid to accountants C) factory electricity expense D) cost of printing brochures 12) The predetermined overhead allocation rate is the rate used to ________. A) assign direct material costs to jobs B) allocate actual.