Chapter 10
United States – AK – IMA: Cost Management
Bloom’s: Remembering
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79. Recording direct labor costs in a job order cost accounting system:
a.
b.
c.
d.
Multiple Choice
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80. Increase in the Work-in-Process account occur when:
a.
materials are received into the storeroom.
b.
factory overhead costs are incurred.
c.
direct labor is recorded from the time sheets.
d.
materials are ordered.
Multiple Choice
Chapter 10
81. At the end of the fiscal year, if the balance in Factory Overhead is small, it would normally be:
a.
transferred to Work-in-Process.
b.
transferred to Cost of Goods Sold.
c.
transferred to Finished Goods.
d.
allocated between Work-in-Process and Finished Goods.
Multiple Choice
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82. Which of the following is the subsidiary ledger for work-in-process?
a.
The finished goods ledger
b.
Job cost sheets
c.
Materials requisitions
d.
The materials ledger
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Chapter 10
83. The recording of the factory labor costs incurred for general factory use would include a debit to:
a.
Factory Overhead.
b.
Wages Payable.
c.
Wages Expense.
d.
Cost of Goods Sold.
Multiple Choice
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7/19/2016 10:17 AM
84. In which of the following cost accounting systems are perpetual inventory records maintained for materials, work-in–
process, and finished goods inventories?
a.
Process costing
b.
Batch costing
Multiple Choice
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United States – AK – IMA: Cost Management
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Chapter 10
c.
Activity based costing
d.
Job order costing
Easy
Multiple Choice
False
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85. The recording of the jobs completed would increase:
a.
Factory Overhead.
b.
Finished Goods.
c.
Work-in-Process.
d.
Cost of Goods Sold.
Easy
Multiple Choice
False
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JFND-GO3A-EW4D-YP4R
Chapter 10
86. The recording of the jobs completed would decrease:
a.
Factory Overhead.
b.
Finished Goods.
c.
Work-in-Process.
d.
Cost of Goods Sold.
c
Easy
Multiple Choice
False
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87. The recording of the jobs shipped and customers billed would increase:
a.
Accounts Payable.
b.
Cash.
c.
Finished Goods.
d.
Cost of Goods Sold.
Easy
Multiple Choice
False
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8R3N-4AT3-CAHS-NCUR-G3DI-GWN8-EPRW-EMMB-GR5U-K3BT-CR3D-RAJI-GASU-
Chapter 10
88. The finished goods account is a controlling account for the subsidiary:
a.
sales ledger.
b.
materials ledger.
c.
work-in-process ledger.
d.
stock ledger.
Easy
Multiple Choice
False
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JFND-GO3A-EW4D-YP31
89. Loise Inc., a manufacturing company, forecasts that total overhead for the current year will be $19,250,000, and total
machine hours will be 350,000 hours. However, the actual overhead is $6,095,000, and the actual machine hours are
142,000 hours. If the company uses a predetermined overhead rate based on machine hours for applying overhead, what is
the predetermined overhead rate?
a.
$23 per machine hour
b.
$192 per machine hour
c.
$55 per machine hour
d.
$43 per machine hour
c
Moderate
Multiple Choice
False
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Chapter 10
90. Robbson Manufacturers has estimated total factory overhead costs of $184,000 and 25,000 direct labor hours for the
current fiscal year. If job number 115 incurred 1,200 direct labor hours, the work-in-process account will be increased and
factory overhead will be decreased by:
a.
$25,000.
b.
$8,832.
c.
$7,022.
d.
$153.
Moderate
False
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91. Upon completing a job, direct materials totaled $4,500; direct labor, $2,500; and factory overhead, $3,500. Units
produced totaled 2,100. What is the per unit cost?
a.
$2
b.
$1
c.
$3
d.
$5
Moderate
False
JFND-GO3A-EW4D-YP3T
Chapter 10
92. During the year, Bright Corporation applied factory overhead costs of $330,000 to production. At the end of the year,
total overapplied factory overhead is $13,000. What was the amount of actual factory overhead cost incurred during the
year?
a.
$343,000
b.
$300,000
c.
$330,000
d.
$317,000
Moderate
False
JFND-GO3A-EW4D-YP3S
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93. Elite, Inc. has estimated total factory overhead costs of $900,000, and 25,000 direct labor hours for the current fiscal
year. If the direct labor hours for Job N41 is 2,000, calculate the total factory overhead applied to this job.
a.
$40,000
b.
$25,000
c.
$4,000
d.
$72,000
JFND-GO3A-EW4D-YP3Z
Chapter 10
94. Hudson, Inc. has estimated total factory overhead costs of $400,000 and 20,000 direct labor hours for the current fiscal
year. If direct labor hours for the year totals 18,000 and actual factory overhead totals $350,000, what is the amount of
overapplied or underapplied overhead for the year?
a.
$10,000 overapplied
b.
$10,000 underapplied
c.
$50,000 underapplied
d.
$50,000 overapplied
Multiple Choice
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95. The sale of a finished good on account would:
a.
decrease Cost of Goods Sold and increase Finished Goods.
Multiple Choice
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Chapter 10
b.
increase Cost of Goods Sold and decrease Finished Goods; increase Accounts Receivable and increase Sales.
c.
increase Sales Expense and decrease Finished Goods; decrease Cash and decrease Accounts Receivable.
d.
increase Work-in-Process and decrease Finished Goods; increase Accounts Receivable and increase Sales.
Multiple Choice
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7/19/2016 10:17 AM
96. Contia Inc. forecasts that total overhead for the current year will be $12,600,000, and total machine hours will be
300,000 hours. However, the actual overhead is $3,250,000, and the actual machine hours are 98,500 hours. If the
company uses a predetermined overhead rate based on machine hours for applying overhead, the overhead will be:
a.
overapplied by $887,000.
b.
underapplied by $887,000.
c.
overapplied by $9,350,000.
d.
underapplied by $9,350,000.
Multiple Choice
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Chapter 10
97. For an automobile company, the total overhead applied was $48,000,000 at the end of the year. Actual overhead was
$52,850,000. Closing over/under applied overhead into cost of goods sold would cause net income to:
a.
increase by $4,850,000.
b.
decrease by $4,850,000.
c.
stay the same.
d.
decrease by $400,000.
Multiple Choice
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98. For a manufacturing business, work-in-process inventories consist of inventories which have _____.
a.
not yet entered the manufacturing process
b.
entered the manufacturing process but not been completed
c.
entered and completed manufacturing process but have not been sold
d.
entered and completed manufacturing process and have been sold
Multiple Choice
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Chapter 10
99. The following information is available for the first month of operations for Bluemoon, Inc.:
Sales
$850,000
Gross profit
330,000
Indirect labor
35,000
Indirect materials
14,000
Other factory overhead
9,000
Materials purchased
360,000
Total manufacturing costs
670,000
Materials inventory, end of period
20,000
Based on the information provided for Bluemoon, Inc., calculate the cost of goods sold.
a.
$670,000
b.
$418,000
c.
$520,000
d.
$650,000
c
Moderate
Multiple Choice
False
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100. The following information is available for the first month of operations for Bluemoon, Inc.:
Sales
$850,000
Gross profit
330,000
Indirect labor
35,000
Indirect materials
14,000
7/19/2016 10:17 AM
JFND-GO3A-EW4D-YPBT
Chapter 10
Other factory overhead
9,000
Materials purchased
360,000
Total manufacturing costs
670,000
Materials inventory, end of period
20,000
Based on the information provided for Bluemoon, Inc., calculate direct materials cost used in production.
a.
$326,000
b.
$340,000
c.
$360,000
d.
$346,000
a
Moderate
Multiple Choice
False
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101. The following information is available for the first month of operations for Brandt, Inc.:
Sales
$570,000
Gross profit
210,000
Indirect labor
20,000
Indirect materials
5,000
Other factory overhead
37,000
Direct materials cost
390,000
Total manufacturing costs
658,000
Calculate direct labor cost for Brandt, Inc.
a.
$226,000
b.
$206,000
c.
$231,000
d.
$218,000
Moderate
Multiple Choice