1) A ____________________ contains features of both process and job order costing
systems.
2) On May 1 of the current year, a company paid $200,000 to purchase 7%, 10-year
bonds with a par value of $200,000; interest is paid semiannually on May 1 and
November 1. The company intends to hold the bonds until they mature. Prepare the
journal entries to record (1) the bond purchase, (2) the receipt of the first semiannual
interest payment on September 1 of the current year, (3) the accrual of interest for
year-end December 31, and (4) the receipt of the second semiannual payment on May 1
3) A manufacturing company’s beginning finished goods inventory was $29,000; cost of
goods manufactured was $316,000; and the ending finished goods inventory was
$31,000. What is the cost of goods sold for that year?
4) ____________________ can benefit a seller by decreasing the delay in receiving
cash and reducing future collection efforts.
5) Craig’s Snowboards uses the perpetual inventory system and had the following sales
transactions during June:
Prepare the journal entries that Craig’s Snowboards must make to record these
transactions.
6) Linx Company’s output for a period was assigned the standard direct labor cost of
$17,160. If the company had a favorable direct labor rate variance of $1,000 and an
unfavorable direct labor efficiency variance of $275, what was the total actual cost of
direct labor incurred during the period?
7) A company uses a job order costing system and applies overhead on the basis of
direct labor cost. A summary of the company’s Work in Process Inventory account for
December appears below.
Fill in the blanks for the following:
(1) The total cost of the direct materials, direct labor, and factory overhead applied in
the December 31 Work in Process inventory is $_______________________.
(2) The company’s overhead application rate is __________________%
(3) Job No. 6 had $26,550 of direct labor cost. Therefore, the job must have had
$________ of direct materials cost.
(4) Job No. 8 had $73,998 of direct materials cost. Therefore, the job must have had
$________ of factory overhead cost.
8) Karl and Grady are managers of two product lines for Brewster Company. One of
them is a candidate for promotion based on performance. Using the data below,
determine who had the better performance using performance measures such as net
income, profit margin, and return on investment. Show your calculations and support
your answer.
9) Investments in equity securities where the investor has a controlling influence are
accounted for using the ________________________________.