Chapter 03 – Job-Order Costing
64. Dowan Company uses a predetermined overhead rate based on direct labor-hours to apply
manufacturing overhead to jobs. Last year Dowan Company incurred $156,600 in actual
manufacturing overhead cost. The Manufacturing Overhead account showed that
manufacturing overhead was underapplied by $12,600 for the year. If the predetermined
overhead rate is $6.00 per direct labor-hour, how many hours did the company work during
the year?
Chapter 03 – Job-Order Costing
65. Kelson Company applies overhead to jobs on the basis of 60% of direct labor cost. If Job
201 shows $27,000 of manufacturing overhead applied, the direct labor cost on the job was:
Chapter 03 – Job-Order Costing
66. The following accounts are from last year’s books at Sharp Manufacturing:
Sharp uses job-order costing and applies manufacturing overhead to jobs based on direct labor
costs. What is the amount of cost of goods manufactured for the year?
Chapter 03 – Job-Order Costing
67. Jurper Corporation used $150,000 of direct materials during April. At the end of April,
Jurper’s direct materials inventory was $25,000 more than it was at the beginning of the
month. Direct materials purchases during the April amounted to:
Chapter 03 – Job-Order Costing
68. Botton Inc. has provided the following data for the month of March. There were no
beginning inventories; consequently, the direct materials, direct labor, and manufacturing
overhead applied listed below are all for the current month.
Manufacturing overhead for the month was underapplied by $7,000.
The company allocates any underapplied or overapplied manufacturing overhead among work
in process, finished goods, and cost of goods sold at the end of the month on the basis of the
overhead applied during the month in those accounts.
The cost of goods sold for March after allocation of any underapplied or overapplied
manufacturing overhead for the month is closest to:
Chapter 03 – Job-Order Costing
69. Desrevisseau Inc., a manufacturing company, has provided the following data for the
month of August. The balance in the Work in Process inventory account was $10,000 at the
beginning of the month and $22,000 at the end of the month. During the month, the company
incurred direct materials cost of $63,000 and direct labor cost of $39,000. The actual
manufacturing overhead cost incurred was $40,000. The manufacturing overhead cost applied
to Work in Process was $43,000. The cost of goods manufactured for August was:
Chapter 03 – Job-Order Costing
70. Under Lamprey Company’s job-order costing system, manufacturing overhead is applied
to Work in Process inventory using a predetermined overhead rate. During January,
Lamprey’s transactions included the following:
Lamprey Company had no beginning or ending inventories. What was the cost of goods
manufactured for January?
Chapter 03 – Job-Order Costing
71. Delhoyo Corporation, a manufacturing company, has provided data concerning its
operations for September. The beginning balance in the raw materials account was $37,000
and the ending balance was $29,000. Raw materials purchased during the month totaled
$57,000. Manufacturing overhead cost incurred during the month was $102,000, of which
$2,000 consisted of raw materials classified as indirect materials. The direct materials cost for
September was:
Chapter 03 – Job-Order Costing
72. Gest Inc. has provided the following data for the month of November. The balance in the
Finished Goods inventory account at the beginning of the month was $49,000 and at the end
of the month was $45,000. The cost of goods manufactured for the month was $226,000. The
actual manufacturing overhead cost incurred was $74,000 and the manufacturing overhead
cost applied to Work in Process was $70,000. The adjusted cost of goods sold that would
appear on the income statement for November is:
Chapter 03 – Job-Order Costing
73. Dydell Inc. has provided the following data for the month of December. There were no
beginning inventories; consequently, the direct materials, direct labor, and manufacturing
overhead applied listed below are all for the current month.
Manufacturing overhead for the month was overapplied by $7,000.
The company allocates any underapplied or overapplied manufacturing overhead among work
in process, finished goods, and cost of goods sold at the end of the month on the basis of the
overhead applied during the month in those accounts.
The finished goods inventory at the end of December after allocation of any underapplied or
overapplied manufacturing overhead for the month is closest to:
Chapter 03 – Job-Order Costing
74. Lyster Inc. has provided the following data for the month of August. There were no
beginning inventories; consequently, the direct materials, direct labor, and manufacturing
overhead applied listed below are all for the current month.
Manufacturing overhead for the month was underapplied by $1,000.
The company allocates any underapplied or overapplied manufacturing overhead among work
in process, finished goods, and cost of goods sold at the end of the month on the basis of the
overhead applied during the month in those accounts.
The work in process inventory at the end of August after allocation of any underapplied or
overapplied manufacturing overhead for the month is closest to:
Chapter 03 – Job-Order Costing
75. Minturn Inc. has provided the following data for the month of September. There were no
beginning inventories; consequently, the direct materials, direct labor, and manufacturing
overhead applied listed below are all for the current month.
Manufacturing overhead for the month was underapplied by $2,000.
The company allocates any underapplied or overapplied manufacturing overhead among work
in process, finished goods, and cost of goods sold at the end of the month on the basis of the
overhead applied during the month in those accounts.
The journal entry to record the allocation of any underapplied or overapplied manufacturing
overhead for September would include the following:
Chapter 03 – Job-Order Costing
76. Graeser Inc. has provided the following data for the month of May. There were no
beginning inventories; consequently, the direct materials, direct labor, and manufacturing
overhead applied listed below are all for the current month.
Manufacturing overhead for the month was overapplied by $4,000.
The company allocates any underapplied or overapplied manufacturing overhead among work
in process, finished goods, and cost of goods sold at the end of the month on the basis of the
overhead applied during the month in those accounts.
The journal entry to record the allocation of any underapplied or overapplied manufacturing
overhead for May would include the following:
Chapter 03 – Job-Order Costing
77. The actual manufacturing overhead incurred at Hogans Corporation during April was
$59,000, while the manufacturing overhead applied to Work in Process was $74,000. The
company’s Cost of Goods Sold was $289,000 prior to closing out its Manufacturing Overhead
account. The company closes out its Manufacturing Overhead account to Cost of Goods Sold.
Which of the following statements is true?
Chapter 03 – Job-Order Costing
78. Sharp Company’s records show that overhead was overapplied by $10,000 last year. This
overapplied manufacturing overhead was closed out to the Cost of Goods Sold account at the
end of the year. In trying to determine why overhead was overapplied by such a large amount,
the company has discovered that $6,000 of depreciation on factory equipment was charged to
administrative expense in error. Given the above information, which of the following
statements is true?
Chapter 03 – Job-Order Costing
79. Caryl Inc. has provided the following data for the month of March. There were no
beginning inventories; consequently, the direct materials, direct labor, and manufacturing
overhead applied listed below are all for the current month.
Manufacturing overhead for the month was underapplied by $10,000.
The company allocates any underapplied or overapplied manufacturing overhead among work
in process, finished goods, and cost of goods sold at the end of the month on the basis of the
overhead applied during the month in those accounts.
The journal entry to record the allocation of any underapplied or overapplied manufacturing
overhead for March would include the following:
Chapter 03 – Job-Order Costing
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80. Lietz Corporation has provided the following data concerning manufacturing overhead for
January:
The company’s Cost of Goods Sold was $369,000 prior to closing out its Manufacturing
Overhead account. The company closes out its Manufacturing Overhead account to Cost of
Goods Sold. Which of the following statements is true?
Bakker Corporation applies manufacturing overhead on the basis of direct labor-hours. At the
beginning of the most recent year, the company based its predetermined overhead rate on total
estimated overhead of $77,250 and 2,500 estimated direct labor-hours. Actual manufacturing
overhead for the year amounted to $79,000 and actual direct labor-hours were 2,400.
Chapter 03 – Job-Order Costing
81. The predetermined overhead rate for the year was closest to:
82. The applied manufacturing overhead for the year was closest to:
Chapter 03 – Job-Order Costing
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83. The overhead for the year was:
Acitelli Corporation, which applies manufacturing overhead on the basis of machine-hours,
has provided the following data for its most recent year of operations.
The estimates of the manufacturing overhead and of machine-hours were made at the
beginning of the year for the purpose of computing the company’s predetermined overhead
rate for the year.
Chapter 03 – Job-Order Costing
84. The predetermined overhead rate is closest to:
85. The applied manufacturing overhead for the year is closest to: