30) Barbicon Manufacturing Company uses a predetermined manufacturing overhead rate based on a percentage of
direct labor cost. At the beginning of 2012, they formulated a rate of 20% times the direct labor cost. In June, 2012,
Barbicon completed job number 13C. Job stats are as follows:
Direct materials cost $6,220
Direct labor cost $900
Direct labor hours 32 hours
Units of product produced: 250 kilos
How much was the total job cost?
A) $8,364
B) $180
C) $7,120
D) $7,300
31) Barbicon Manufacturing Company uses a predetermined manufacturing overhead rate based on a percentage of
direct labor cost. At the beginning of 2012, they formulated a rate of 20% times the direct labor cost. In June, 2012,
Barbicon completed job number 13C. Job stats are as follows:
Direct materials cost $6,220
Direct labor cost $900
Direct labor hours 32 hours
Units of product produced: 250 kilos
How much was the cost per unit (cost per kilo) of finished product? (Please round to the nearest cent.)
A) $29.20
B) $33.46
C) $28.48
D) $36.70
32) In 2012, the Cameratta Company used a predetermined manufacturing overhead rate of $4.75 per machine hour.
Information for the year is as follows:
Actual overhead costs incurred:
Indirect materials $5,200
Indirect labor $3,750
Plant depreciation $4,800
Plant utilities and insurance $9,530
Other plant overhead costs $12,700
Total machine hours used during the year 7,520
What was the preliminary ending balance in the manufacturing overhead account before the year-end adjustment to
clear the balance to zero?
A) Credit of $260
B) Debit of $550
C) Credit of $330
D) Debit of $260
33) In 2012, the Doric Agricultural Products Company used a predetermined manufacturing overhead rate of 150%
times direct labor cost. Information for the year is as follows:
Actual direct materials cost $812,500
Actual direct labor cost $180,000
Actual overhead costs incurred: $264,000
Total direct labor hours 5,520
What was the preliminary ending balance in the manufacturing overhead account, before the year-end adjustment to
clear the balance to zero?
A) Credit of $6,000
B) Debit of $6,000
C) Credit of $5,900
D) Debit of $4,300
34) The Quadrangle Fabrication Plant had a fire at the beginning of 2013 and most of the records for the year 2012
were lost. Some data for the year 2012 were located by the accountants and are shown below.
Total manufacturing overhead estimated at the beginning of the year: $105,840
Total direct labor costs estimated at the beginning of the year: $186,000
Total direct labor hours estimated at the beginning of the year: 3,600 direct labor hours
Actual manufacturing overhead costs for the year: $99,760
Actual direct labor costs for the year: $142,000
Actual direct labor hours for the year: 2,950 direct labor hours
The company bases its manufacturing overhead allocation on direct labor hours. What was the predetermined
manufacturing overhead allocation rate for 2012? (Please round to the nearest cent.)
A) $35.87
B) $33.82
C) $29.40
D) $27.71
35) The Quadrangle Fabrication Plant had a fire at the beginning of 2013 and most of the records for the year 2012
were lost. Some data for the year 2012 were located by the accountants and are shown below.
Total manufacturing overhead estimated at the beginning of the year: $105,840
Total direct labor costs estimated at the beginning of the year: $186,000
Total direct labor hours estimated at the beginning of the year: 3,600 direct labor hours
Actual manufacturing overhead costs for the year: $99,760
Actual direct labor costs for the year: $142,000
Actual direct labor hours for the year: 2,950 direct labor hours
The company bases its manufacturing overhead allocation on direct labor hours. How much manufacturing
overhead was allocated to production in 2012? (Please round to the nearest whole dollar.)
A) $105,816
B) $86,730
C) $99,769
D) $81,745
36) The Quadrangle Fabrication Plant had a fire at the beginning of 2013 and most of the records for the year 2012
were lost. Some data for the year 2012 were located by the accountants and are shown below.
Total manufacturing overhead estimated at the beginning of the year: $105,840
Total direct labor costs estimated at the beginning of the year: $186,000
Total direct labor hours estimated at the beginning of the year: 3,600 direct labor hours
Actual manufacturing overhead costs for the year: $99,760
Actual direct labor costs for the year: $142,000
Actual direct labor hours for the year: 2,950 direct labor hours
The company bases its manufacturing overhead allocation on direct labor hours. What was the preliminary ending
balance in the manufacturing overhead account prior to the year–end adjustment to clear the balance to zero?
(Please round to the nearest whole dollar.)
A) $6,080 credit balance
B) $4,982 debit balance
C) $13,030 credit balance
D) $13,030 debit balance
37) Archangel Manufacturing has just finished the year 2012. They created a predetermined manufacturing
overhead allocation rate at the beginning of the year based on a percentage of direct labor costs. Below are various
data:
Total manufacturing overhead estimated at the beginning of the year: $140,000
Total direct labor costs estimated at the beginning of the year: $350,000
Total direct labor hours estimated at the beginning of the year: 12,000 direct labor hours
Actual manufacturing overhead costs for the year: $159,000
Actual direct labor costs for the year: $362,000
Actual direct labor hours for the year: 12,400 direct labor hours
Based on the data above, what was the allocation rate for 2012? (Please round to nearest whole percent.)
A) 40%
B) 44%
C) 250%
D) 228%
38) Archangel Manufacturing has just finished the year 2012. They created a predetermined manufacturing
overhead allocation rate at the beginning of the year based on a percentage of direct labor costs. Below are various
data:
Total manufacturing overhead estimated at the beginning of the year: $140,000
Total direct labor costs estimated at the beginning of the year: $350,000
Total direct labor hours estimated at the beginning of the year: 12,000 direct labor hours
Actual manufacturing overhead costs for the year: $159,000
Actual direct labor costs for the year: $362,000
Actual direct labor hours for the year: 12,400 direct labor hours
Based on the data above, how much manufacturing overhead was allocated to production? (Please round to nearest
whole dollar.)
A) $825,360
B) $905,000
C) $144,800
D) $159,280
39) Archangel Manufacturing has just finished the year 2012. They created a predetermined manufacturing
overhead allocation rate at the beginning of the year based on a percentage of direct labor costs. Below are various
data:
Total manufacturing overhead estimated at the beginning of the year: $140,000
Total direct labor costs estimated at the beginning of the year: $350,000
Total direct labor hours estimated at the beginning of the year: 12,000 direct labor hours
Actual manufacturing overhead costs for the year: $159,000
Actual direct labor costs for the year: $362,000
Actual direct labor hours for the year: 12,400 direct labor hours
Based on the data above, what was the preliminary ending balance in the manufacturing overhead account, prior to
the year-end adjustment to clear the balance to zero? (Please round to nearest whole dollar.)
A) $19,000 credit balance
B) $19,000 debit balance
C) $14,200 credit balance
D) $14,200 debit balance
40) Petraeus Fabrication Company has provided the following information for the year 2012:
Actual manufacturing overhead costs incurred $268,000
Manufacturing overhead costs allocated to production $259,200
Actual direct materials cost $800,000
Actual direct labor cost $144,000
Actual direct labor hours 3,200 direct labor hours
Actual machine hours 10,900 machine hours
Based on the above information, what was Petraeus’s allocation rate? (Hint: for this type of problem, the “trial and
error” method may be used.)
A) $95 per direct labor hour
B) 180% of direct labor cost
C) $8.50 per machine hour
D) 12% of direct materials cost
41) Q-dot Manufacturing Company has provided the following information for the year 2012:
Actual manufacturing overhead costs incurred $199,900
Manufacturing overhead costs allocated to production $189,000
Actual direct materials cost $560,000
Actual direct labor cost $333,000
Actual direct labor hours 9,450 direct labor hours
Actual machine hours 180,000 machine hours
Based on the above information, what was Q-dot’s allocation rate? (Hint: for this type of problem, the “trial and
error” method may be used.)
A) $7.60 per machine hour
B) 132% of direct labor cost
C) 80% of direct materials cost
D) $20 per direct labor hour
42) Felton Quality Productions Company has provided the following information for the year 2012:
Actual manufacturing overhead costs incurred $89,770
Manufacturing overhead costs allocated to production $95,200
Actual direct materials cost $224,000
Actual direct labor cost $93,750
Actual direct labor hours 18,500 direct labor hours
Actual machine hours 56,000 machine hours
Based on the above information, what was Felton’s allocation rate? (Hint: for this type of problem, the “trial and
error” method may be used.)
A) $1.70 per machine hour
B) 52% of direct labor cost
C) 180% of direct materials cost
D) $24.80 per direct labor hour
43) Davie Company used estimated direct labor hours of 180,000 and estimated manufacturing overhead costs of
$990,000 in establishing its 2012 predetermined manufacturing overhead rate. Actual results showed:
Actual manufacturing overhead
$950,000
Allocated manufacturing overhead
$962,500
What was the number of direct labor hours worked during 2009?
A) 180,000
B) 186,000
C) 192,000
D) 175,000
44) Forsyth Company uses estimated direct labor hours of 150,000 and estimated manufacturing overhead costs of
$337,500 in establishing its 2012 predetermined manufacturing overhead rate. Actual results showed:
Actual manufacturing overhead
$346,500
Allocated manufacturing overhead
$343,800
The number of direct labor hours worked during the period was:
A) 154,000.
B) 152,800.
C) 150,000.
D) 146,000.
45) The records at Smith and Jones Company show Job. No. 110 charged with $11,000 of direct materials and
$12,500 of direct labor. Smith and Jones Company allocates manufacturing overhead at 85% of direct labor cost.
What is the total cost of Job No. 110?
A) $20,625
B) $34,125
C) $22,500
D) $21,625
46) Haverhill Products just completed job number 440. In addition to direct labor and direct materials cost,
Haverhill allocated $450 of manufacturing overhead to the job. Please provide the journal entry for the allocation of
overhead.
Work in process inventory
47) Gardner Machine Shop estimates manufacturing overhead costs for the coming year at $316,000. They will
allocate based on direct labor hours. Gardner estimates 5,000 direct labor hours for the coming year. In January,
Gardener completed job number A33, which included 15 direct labor hours. Please provide the journal entry to
allocate overhead to the job.
Work in process inventory
48) Gardner Machine Shop uses a predetermined manufacturing overhead rate of $63.20 per direct labor hour. In
January, Gardener completed job number A33, which included 15 direct labor hours. Please provide the journal
entry to allocate overhead to the job.
Work in process inventory
Learning Objective 17-4
1) The cost of goods manufactured is recorded as a debit to the Work in process account.
2) During 2012, a company incurs $500,000 of manufacturing overhead costs and allocates out $492,000 of
manufacturing overhead costs. Overhead costs have been underallocated.
3) During 2012, a company incurs $500,000 of manufacturing overhead costs and allocates out $506,000 of
manufacturing overhead costs. At year-end, the adjustment entry needed to clear the overhead balance to zero will
include a debit to Cost of goods sold.
4) During 2012, a company incurs $500,000 of manufacturing overhead costs and allocates out $460,000 of
manufacturing overhead costs. At year-end, the adjustment entry needed to clear the overhead balance to zero will
include a debit to Cost of goods sold.
5) The cost of goods manufactured is recorded as a debit to the Finished goods account.
6) When jobs are completed, the total cost of the job is recorded as a debit to Finished goods and a credit to Work in
process.
7) Overallocated manufacturing overhead occurs when the manufacturing overhead allocated to work in process
inventory is less than the amount actually incurred.
8) Cost of goods sold needs to be debited at year-end when the manufacturing overhead is overallocated in order to
clear the overhead account to zero.
9) During 2012, a company incurs $500,000 of manufacturing overhead costs and allocates out $506,000 of
manufacturing overhead costs. Overhead costs have been underallocated.
10) On January 1, 2012, Matthew Company’s work in process inventory account had a balance of $30,000. During
2012, $58,000 of direct materials was placed into production. Manufacturing wages incurred amounted to $84,000,
of which $66,000 were for direct labor. Manufacturing overhead is allocated on the basis of 120% of direct labor
cost. Actual manufacturing overhead was $90,000. Jobs costing $220,400 were completed during 2009. What is the
December 31, 2012 balance in work in process inventory?
A) $16,800
B) $34,800
C) $6,000
D) $12,800
11) On January 1, 2012, Jackson Company’s work in process inventory account had a balance of $65,000. During
2012, materials requisitioned for use in production amounted to $70,000, of which $66,000 represented direct
materials. Factory wages for the period were $209,000, of which $186,400 were for direct labor. Manufacturing
overhead is allocated on the basis of 60% of direct labor cost. Actual overhead was $116,440. Jobs costing $353,240
were completed during 2012. The December 31, 2012, balance in work in process inventory is:
A) $80,000.
B) $72,800.
C) $107,200.
D) $76,000.
12) Overallocation of manufacturing overhead would require which of the following year-end adjustments?
A) A credit to Finished goods inventory
B) A credit to Manufacturing overhead
C) A debit to Work-in process inventory
D) A credit to Cost of goods sold
13) Underallocation of manufacturing overhead would require which of the following year–end adjustments?
A) A credit to Finished goods inventory
B) A credit to Manufacturing overhead
C) A debit to Work-in process inventory
D) A credit to Cost of goods sold
14) Underallocated manufacturing overhead costs are always the result of which of the following situations?
A) Allocated overhead costs are less than actual overhead costs.
B) Actual overhead costs are less than allocated overhead costs.
C) Actual overhead costs are greater than estimated overhead costs.
D) Estimated overhead costs are greater than actual overhead costs.
15) Lakeside Company estimated manufacturing overhead costs for 2012 at $378,000, based on 180,000 estimated
direct labor hours. Actual direct labor hours for 2012 totaled 195,000. The manufacturing overhead account
contains debit entries totaling $391,500. The manufacturing overhead for 2012 was:
A) $31,500 underallocated.
B) $31,500 overallocated.
C) $18,000 underallocated.
D) $18,000 overallocated.
16) Caltran Company has just completed manufacturing job number 445. It included $320 of direct materials cost,
$1,240 of direct labor cost, and $560 of allocated overhead. Which of the following is the correct journal entry
needed to record the completed job?
A)
Work in process inventory
2,120
Finished goods inventory
2,120
B)
Finished goods inventory
2,120
Materials inventory
2,120
C)
Work in process inventory
40,000
Cost of goods sold
40,000
D)
Finished goods inventory
2,120
Work in process inventory
2,120
17) Altina Company just finished job A40. It included $400 of direct materials, and $3,600 of direct labor. Altina
uses a predetermined manufacturing overhead rate based on a percentage of direct labor costs. That rate is 40%.
The entry to record the completion of the job should be a:
A) debit to Finished goods $5,440, and a credit to Materials inventory $5,440.
B) debit to Cost of goods sold $5,440, and a credit to Finished goods $5,440.
C) debit to Finished goods $5,440, and a credit to Work in process $5,440.
D) debit to Work in process $5,440, and a credit to Finished goods $5,440.
18) At the end of the year, Deltona Company has a preliminary debit balance in the Manufacturing overhead account
of $3,950. Which of the following is the year-end adjusting entry needed to clear the balance to zero?
A) Debit Cost of goods sold $3,950, credit Manufacturing overhead $3,950
B) Debit Manufacturing overhead $3,950, credit Cost of goods sold
C) Debit Work in process $3,950, credit Manufacturing overhead $3,950
D) Debit Gross profit $3,950, credit Cost of goods sold $3,950
19) At the end of the year, Martin Company has a preliminary credit balance in the Manufacturing overhead account
of $95. Which of the following is the year-end adjusting entry needed to clear the balance to zero?
A) Debit Cost of goods sold $95, credit Finished goods inventory $95
B) Debit Manufacturing overhead $95, credit Finished goods inventory $95
C) Debit Manufacturing overhead $95, credit Cost of goods sold $95
D) Debit Cost of goods sold $95, credit Manufacturing overhead $95
20) On June 30, Coraline Company finished job number 750, with total job costs of $4,600, and transferred the costs
to Finished goods. On July 6, they completed the sale of the goods to a customer for $5,100 cash. In order to
record the sale, two entries are necessary, one to record revenue, and one to record cost of goods sold. Which of the
following is the correct entry needed to record the revenues?
A) Debit Finished goods inventory $4,600, credit Sales revenue $4,600
B) Debit cash $5,100, credit Sales revenue $5,100
C) Debit Sales revenue $5,100, credit Cash $5,100
D) Debit Cost of goods sold $4,600, credit Sales revenue $4,600
21) On June 30, Coraline Company finished job number 750, with total job costs of $4,600, and transferred the costs
to Finished goods. On July 6, they completed the sale of the goods to a customer for $5,100 cash. In order to
record the sale, two entries are necessary, one to record revenue, and one to record cost of goods sold. Which of the
following is the correct entry needed to record the cost of goods sold?
A) Debit Finished goods inventory $4,600, credit Cost of goods sold $4,600
B) Debit Cost of goods sold $4,600, credit Work in process inventory $4,600
C) Debit Work in process inventory $4,600, credit Cost of goods sold $4,600
D) Debit Cost of goods sold $4,600, credit Finished goods inventory $4,600
22) At the beginning of 2012, Conway Manufacturing Company had the following account balances:
During the year, the following transactions took place:
Direct materials placed in production: $80,000
Direct labor incurred: $190,000
Manufacturing overhead incurred $300,000
Manufacturing overhead allocated to production: $295,000
Jobs completed with cost of : $500,000
After these transactions have been recorded, the preliminary balance in the Work in process account is a:
A) credit of $63,000.
B) debit of $70,000.
C) debit of $72,000.
D) debit of $67,000.
23) At the beginning of 2012, Conway Manufacturing Company had the following account balances:
During the year, the following transactions took place:
Direct materials placed in production: $80,000
Direct labor incurred: $190,000
Manufacturing overhead incurred: $300,000
Manufacturing overhead allocated to production: $295,000
Jobs completed with cost of : $500,000
After these transactions have been recorded, the preliminary balance in the Finished goods account is a:
A) debit of $508,000.
B) debit of $500,000.
C) debit of $573,000.
D) debit of $65,000.
24) At the beginning of 2012, Conway Manufacturing Company had the following account balances:
During the year, the following transactions took place:
Direct materials placed in production: $80,000
Direct labor incurred: $190,000
Manufacturing overhead incurred $300,000
Manufacturing overhead allocated to production: $295,000
Jobs completed with cost of : $500,000
After these transactions have been recorded, the preliminary balance in the Manufacturing overhead account is a:
A) credit of $295,000.
B) credit of $5,000.
C) debit of $5,000.
D) debit of $13,000.
25) At the beginning of 2012, Conway Manufacturing Company had the following account balances:
During the year, the following transactions took place:
Direct materials placed in production: $80,000
Direct labor incurred: $190,000
Manufacturing overhead incurred $300,000
Manufacturing overhead allocated to production: $295,000
Jobs completed with cost of : $500,000
Jobs sold for total revenue of : $750,000
Jobs sold with cost of : $440,000
Remaining balance of Manufacturing overhead cleared to zero
After recording all of these transactions, the ending balance in the Work in process account is a:
A) credit of $63,000.
B) debit of $70,000.
C) debit of $72,000.
D) debit of $67,000.
26) At the beginning of 2012, Conway Manufacturing Company had the following account balances:
During the year, the following transactions took place:
Direct materials placed in production: $80,000
Direct labor incurred: $190,000
Manufacturing overhead incurred: $300,000
Manufacturing overhead allocated to production: $295,000
Jobs completed with cost of: $500,000
Jobs sold for total revenue of: $750,000
Jobs sold with cost of: $440,000
Remaining balance of Manufacturing overhead cleared to zero
After recording all these transactions, the ending balance in the Finished goods account is a:
A) credit of $52,000.
B) debit of $60,000.
C) credit of $432,000.
D) debit of $68,000.
27) At the beginning of 2012, Conway Manufacturing Company had the following account balances:
During the year, the following transactions took place:
Direct materials placed in production: $80,000
Direct labor incurred: $190,000
Manufacturing overhead incurred $300,000
Manufacturing overhead allocated to production: $295,000
Jobs completed with cost of: $500,000
Jobs sold for total revenue of: $750,000
Jobs sold with cost of: $440,000
Remaining balance of Manufacturing overhead cleared to zero
After recording all these transactions, the ending balance in the Cost of goods sold account is a:
A) debit of $435,000.
B) debit of $445,000.
C) credit of $445,000.
D) debit of $440,000.
28) At the beginning of 2012, Conway Manufacturing Company had the following account balances:
During the year, the following transactions took place:
Direct materials placed in production: $80,000
Direct labor incurred: $190,000
Manufacturing overhead incurred $300,000
Manufacturing overhead allocated to production: $295,000
Jobs completed with cost of: $500,000
Jobs sold for total revenue of: $750,000
Jobs sold with cost of: $440,000
Remaining balance of Manufacturing overhead cleared to zero
As a result of these transactions, how much gross profit will Conway report?
A) $315,000
B) $305,000
C) $310,000
D) $345,000
29) At January 1, 2012, Feldstein Manufacturing Company had a beginning balance in Work in process of $80,000
and a beginning balance in Finished goods of $20,000. During the year, Feldstein incurred
manufacturing costs of $350,000.
During the year, the following transactions occurred:
Job A-12, was completed for a total cost of $120,000 and was sold for $125,000.
Job A-13, was completed for a total cost of $200,000 and was sold for $210,000.
Job A-15, was completed for a total cost $60,000, but was not sold as of year-end.
At the end of the year, what was the balance in Finished goods?
A) $60,000 debit balance
B) $40,000 credit balance
C) $80,000 debit balance
D) $30,000 debit balance