ACCG211 – EXAM 3 – CH 18-20

A company's prime costs total $3,000,000 and its conversion costs total $7,000,000. If direct materials are $1,000,000 and factory overhead is $5,000,000, then direct labor is: a. $3,000,000. b. $4,000,000. c. $2,000,000. d. $14,000,000. e. $1,000,000.

The salary paid to the supervisor of an assembly line would normally be classified as: a. Direct labor. b. Indirect labor. c. A period cost. d. A general cost. e.An assembly cost.

A manufacturing company has a beginning finished goods inventory of $14,600, raw material purchases of $18,000, cost of goods manufactured of $32,500, and an ending finished goods inventory of $17,800. The cost of goods sold for this company is: a. $47,100. b. $29,300. c. $21,200. d. $27,600. e. $32,500.

Product costs: a. Include selling and administrative expenses. b. Are expenditures identified more with a time period rather than with finished products. c. Are expenditures necessary and integral to finished products. d. Are costs that vary with the volume of activity. e. Are costs that do not vary with the volume of activity.

A direct cost is a cost that is: a. Sunk with respect to a cost object. b. Variable with respect to the volume of activity. c. Traceable to a cost object. d. Identifiable as controllable. e. Fixed with respect to the volume of activity.

Products that are in the process of being manufactured but are not yet complete are called: a. Conversion costs. b. Cost of goods sold. c. Finished goods inventory. d. Raw materials inventory. e. Goods in process inventory.

Factory overhead costs normally include all of the following except: a. Indirect labor costs. b. Factory rent. c. Indirect material costs. d. Machinery oil. e. Selling costs.

Which of the following costs would not be classified as factory overhead? a. Property taxes on maintenance machinery. b. Metal doorknobs used on wood cabinets produced. c. Wages of the factory janitor. d. Small tools used in production. e. Expired insurance on factory equipment.

Period costs for a manufacturing company would flow directly to: a. The current income statement. b. Job cost sheet. c. The current manufacturing statement. d. The current balance sheet. e. Factory overhead.

Products that have been completed and are ready to be sold by the manufacturer are called: a. Factory supplies. b. Goods in process inventory. c. Raw materials inventory. d. Finished goods inventory. e. Cost of goods sold.

Labor costs in production can be: a.Direct or payroll. b. Indirect or payroll. c. Indirect or sunk. d. Direct or indirect. e. Direct or sunk.

A company has an overhead application rate of 125% of direct labor costs. How much overhead would be allocated to a job if it required total labor costing $20,000? a. $250,000. b. $16,000. c. $5,000. d. $125,000. e. $25,000.

Canoe Company uses a job order cost accounting system and allocates its overhead on the basis of direct labor costs. Canoe Company's production costs for the year were: direct labor, $30,000; direct materials, $50,000; and factory overhead applied $6,000. The overhead application rate was: a. 20.0%. b. 12.0%. c. 500.0%. d. 16.7%. e. 5.0%.

When factory payroll costs for labor are allocated in a job cost accounting system: a. Factory Payroll is debited and Goods in Process Inventory is credited. b. Goods in Process Inventory is debited and Factory Payroll is credited. c. Direct Labor and Indirect Labor are debited and Factory Payroll is credited. d. Goods in Process Inventory and Factory Overhead are debited and Factory Payroll is credited. e. Cost of Goods Manufactured is debited and Direct Labor is credited.

The overhead cost applied to a job during a period is recorded with a credit to Factory Overhead and a debit to: a. Indirect Labor. b. Jobs Overhead Expense. c. Finished Goods Inventory. d. Goods in Process Inventory. e. Cost of Goods Sold.

The Goods in Process Inventory account of a manufacturing company that uses an overhead rate based on direct labor cost has a $4,400 debit balance after all posting is completed. The cost sheet of the one job still in process shows direct material cost of $2,000 and direct labor cost of $800. Therefore, the company's overhead application rate is: a. 40%. b. 80%. c. 220%. d. 50%. e. 200%.

A company that uses a job order cost accounting system would make the following entry to record the flow of direct materials into production: a. Debit Goods in Process Inventory, credit Raw Materials Inventory. b. Debit Finished Goods Inventory, credit Raw Materials Inventory. c. Debit Factory Overhead, credit Raw Materials Inventory. d. Debit Goods in Process Inventory, credit Factory Overhead. e. Debit Goods in Process Inventory, credit Cost of Goods Sold.

Penn Company uses a job order cost accounting system. In the last month, the system accumulated labor time tickets totaling $24,600 for direct labor and $4,300 for indirect labor. These costs were accumulated in Factory Payroll as they were paid. Which entry should Penn make to assign the Factory Payroll? a. Debit Goods in Process Inventory $24,600; debit Factory Overhead $4,300; credit Factory Payroll $28,900. b. Debit Payroll Expense $24,600; debit Factory Overhead $4,300; credit Factory Payroll $28,900. c. Debit Goods in Process Inventory $24,600; debit Factory Overhead $4,300; credit Wages Payable $28,900. d. Debit Payroll Expense $28,900; credit Cash $28,900. e. Debit Goods in Process Inventory $28,900; credit Factory Payroll $28,900.

Which of the following products is least likely to be produced in a process manufacturing system? a. Baseball hats b. Compact disks c. Custom cabinets d. Slacks for casual wear e. Calculators

The Machining Department started the current month with a beginning goods in process inventory of $10,000. During the month, it was assigned the following costs: direct materials, $76,000; direct labor, $24,000; and factory overhead, 50% of direct labor cost. Also, inventory with a cost of $109,000 was transferred out of the department to the next phase in the process. The ending balance of the Goods in Process Inventory account for the Machining Department is: a. $56,000. b. $110,000. c. $165,000. d. $13,000. e. $59,000.

Hou Company applies factory overhead to its production departments on the basis of 90% of direct labor costs. In the Assembly Department, Hou had $125,000 of direct labor cost, and in the Finishing Department, Hou had $35,000 of direct labor cost. The entry to apply overhead to these production departments is: a. Debit Factory Payroll $144,000; credit Cash $144,000. b. Debit Factory Overhead - Assembly $112,500; debit Factory Overhead - Finishing $31,500; credit Goods in Process Inventory $144,000. c. Debit Factory Overhead $144,000; credit Factory Payroll $144,000. d. Debit Factory Overhead $144,000; credit Goods in Process Inventory - Assembly $112,500; credit Goods in Process - Finishing $31,500. e.Debit Goods in Process Inventory - Assembly $112,500; debit Goods in Process Inventory - Finishing $31,500; credit Factory Overhead $144,000.

Which of the following characteristics applies to process cost accounting but not to job order cost accounting? a. Use of a single Goods in Process Inventory account. b. Identifiable lots of production. c. Use of a predetermined overhead rate. d. Labor time ticket for each employee. e. Equivalent units of production.

Which of the following characteristics does not usually apply to process manufacturing systems? a. Partially completed products are transferred between processes. b. Different managers are responsible for different processes. c. All of the choices include characteristics of process manufacturing systems. d. The output of all processes except the final process is an input to the next process. e. Each unit of product is separately identifiable.

Equivalent units of production are equal to: a. The number of finished units actually produced during a period. b. The number of units introduced into the process during a period. c. The number of units that could have been completed if all effort had been applied to units that were started and completed during a period. d. Physical units that were started and completed during a period. e. The number of units still in process at the end of a period.