Tuesday, 18 February 2020
Monday, 27 January 2020
Which of the following companies would most likely use job costing?
Which
of the following companies would most likely use job costing?
ANSWER
INCORRECT
·
YOU WERE SURE AND INCORRECT
Paper manufacturer
·
Paint producer
·
THE CORRECT ANSWER
Advertising agency
·
Breakfast cereal maker
·
I DON'T KNOW YET
Which
industry is most likely to use the job costing method?
ANSWER
INCORRECT
·
Oil
refining
·
THE
CORRECT ANSWER
Construction
·
YOU WERE SURE AND INCORRECT
Food
production
·
Chemical
processing
·
I DON'T KNOW YET
QUESTION
REVIEWING 3 OF 6
Athens
Machining had one job in Work in Process Inventory at the beginning of the
month: Job 1376. Athens has a predetermined overhead rate of $14.00 per direct
labor hour. The total direct labor hours were 160 direct labor hours.
How
much manufacturing overhead (MOH) should the manager allocate to Job 1376?
ANSWER
INCORRECT
·
$1,120
·
THE CORRECT ANSWER
$2,240
·
$44,200
·
YOU WERE SURE AND INCORRECT
$46,400
·
I DON'T KNOW YET
QUESTION
REVIEWING 4 OF 6
Chelsea,
Inc. uses the job costing method and designates the direct labor hours as the
allocation base. In 2016, the total estimated and actual overhead costs for
Chelsea, Inc. was $250,000 and $275,000, respectively. The total estimated and
actual direct labor hours for chelsea, Inc. was 25,000 and 28,000,
respectively.
What
is the predetermined manufacturing overhead (MOH) rate per direct labor hour
(DLH)? (round your answer to the nearest $.01)
ANSWER
INCORRECT
·
$9.93
·
$8.93
·
YOU WERE SURE AND INCORRECT
$11.00
·
THE CORRECT ANSWER
$10.00
·
I DON'T KNOW YET
QUESTION
REVIEWING 5 OF 6
The
direct labor rate for Brent Corporation is $9.00 per hour, and manufacturing
overhead is applied to products using a predetermined overhead rate of $6.00
per direct labor-hour. During May, the company purchased $60,000 in raw
materials (all direct materials) and worked 3,200 direct labor-hours. The Raw
Materials Inventory (all direct materials) decreased by $3,000 between the
beginning and end of May. The Work in Process Inventory on May 1 consisted of
one job which had been charged with $4,000 in direct materials and on which 300
hours of direct labor time had been worked. There was no Work in Process
Inventory on May 31.
If
overhead was underallocated by $2,500 during May, what is the actual
manufacturing overhead cost?
ANSWER
INCORRECT
·
THE CORRECT ANSWER
$21,700
·
$18,500
·
YOU WERE SURE AND INCORRECT
$23,500
·
$16,700
·
I DON'T KNOW YET
QUESTION
REVIEWING 6 OF 6
Artsy
Sportswear manufactures a specialty line of silk-screened T-shirts. The company
uses a job-order costing system. During May, the manager incurred the following
costs on Job PS4: direct materials $27,400 and direct labor $9,600. In addition,
the manager incurred selling and shipping costs of $14,000. The manager applied
manufacturing overhead at the rate of $25 per machine-hour and Job PS4 required
160 machine-hours.
What
was the cost of goods sold per shirt if Job PS4 consisted of 5,000 shirts?
ANSWER
INCORRECT
·
THE
CORRECT ANSWER
$8.20
·
$25.00
·
YOU WERE SURE AND INCORRECT
$11.00
·
$7.40
·
I DON'T KNOW YET
WHAT YOU NEED TO KNOW
The
cost of goods sold per shirt if Job PS4 consisted of 5,000 shirts equates to $8.20 / shirt. The calculation to solve the
problem is:
[DM
($27,400) + DL ($9,600) + MOH allocated ($25 x 160 MHR)]/ 5,000 shirts
=
[$27,400 + $9,600 + $4,000]/5,000
=
$41,000/5000 = $8.20/shirt
The
other answers are incorrect.
QUESTION
REVIEWING 5 OF 6
The direct labor rate for Brent Corporation is
$9.00 per hour, and manufacturing overhead is applied to products using a
predetermined overhead rate of $6.00 per direct labor-hour. During May, the
company purchased $60,000 in raw materials (all direct materials) and worked
3,200 direct labor-hours. The Raw Materials Inventory (all direct materials)
decreased by $3,000 between the beginning and end of May. The Work in Process
Inventory on May 1 consisted of one job which had been charged with $4,000 in
direct materials and on which 300 hours of direct labor time had been worked.
There was no Work in Process Inventory on May 31.
If overhead was underallocated by $2,500 during
May, what is the actual manufacturing overhead cost?
ANSWER
INCORRECT
·
THE CORRECT ANSWER
$21,700
·
$18,500
·
YOU WERE SURE AND INCORRECT
$23,500
·
$16,700
·
I DON'T KNOW YET
WHAT YOU NEED TO KNOW
If overhead was underallocated by $2,500 during May, the actual
overhead cost for the month must have been $21,700.
The formula to compute the actual overhead cost is: Underallocated
(overallocated) manufacturing overhead = Actual manufacturing overhead − Manufacturing
overhead allocated.
$2,500 = Actual manufacturing overhead − ($6.00 per direct
labor-hour × 3,200 direct labor-hours)
Actual manufacturing overhead = $2,500 + ($6.00 per direct
labor-hour × 3,200 direct labor-hours)
Actual Manufacturing Overhead = $2,500 + $19,200 = $21,700.
QUESTION
REVIEWING 4 OF 6
Chelsea,
Inc. uses the job costing method and designates the direct labor hours as the
allocation base. In 2016, the total estimated and actual overhead costs for
Chelsea, Inc. was $250,000 and $275,000, respectively. The total estimated and
actual direct labor hours for chelsea, Inc. was 25,000 and 28,000, respectively.
What
is the predetermined manufacturing overhead (MOH) rate per direct labor hour
(DLH)? (round your answer to the nearest $.01)
ANSWER
INCORRECT
·
$9.93
·
$8.93
·
YOU WERE SURE AND INCORRECT
$11.00
·
THE
CORRECT ANSWER
$10.00
·
I DON'T KNOW YET
WHAT YOU NEED TO KNOW
The
predetermined MOH rate per DLH is $10 / DLH. The company calculates the
predetermined manufacturing overhead (MOH) rate as:
Predetermined
MOH rate = Total estimated manufacturing overhead costs / Total estimated
amount of the allocation base
=
$250,000 / 25,000 DLH
=
$10/DLH.
The
other answer choices are incorrect.
QUESTION
REVIEWING 3 OF 6
Athens
Machining had one job in Work in Process Inventory at the beginning of the
month: Job 1376. Athens has a predetermined overhead rate of $14.00 per direct
labor hour. The total direct labor hours were 160 direct labor hours.
How
much manufacturing overhead (MOH) should the manager allocate to Job 1376?
ANSWER
INCORRECT
·
$1,120
·
THE
CORRECT ANSWER
$2,240
·
$44,200
·
YOU WERE SURE AND INCORRECT
$46,400
·
I DON'T KNOW YET
WHAT YOU NEED TO KNOW
The
MOH allocated to Job 1376 for the month is $2,240. [$14.00 per direct labor hour
x 160 direct labor hours]. The other answers are incorrect.
QUESTION
REVIEWING 2 OF 6
Which
industry is most likely to use the job costing method?
ANSWER
INCORRECT
·
Oil
refining
·
THE
CORRECT ANSWER
Construction
·
YOU WERE SURE AND INCORRECT
Food
production
·
Chemical
processing
·
I DON'T KNOW YET
WHAT YOU NEED TO KNOW
The construction industry is most likely
to use the job costing method. Job costing is used for industries that produce
unique, custom-ordered products, or relatively small batches of different
products. The construction industry produces uniquely designed or custom-ordered
buildings. The oil refining, food production, and chemical processing
industries typically mass-produce similar products. This is a characteristic of
the process costing method.
QUESTION
REVIEWING 1 OF 6
Which
of the following companies would most likely use job costing?
ANSWER
INCORRECT
·
YOU WERE SURE AND INCORRECT
Paper
manufacturer
·
Paint
producer
·
THE
CORRECT ANSWER
Advertising
agency
·
Breakfast
cereal maker
·
I DON'T KNOW YET
WHAT YOU NEED TO KNOW
An advertising agency would most likely use job
order costing since the jobs would be unique and customized for the client. A
paper manufacturer, paint producer, and breakfast cereal maker would use a
process costing system.
Learn
QUESTION
Which
of the following represents a TRUE statement about the flow of inventory
through a manufacturing system?
ANSWER
Correct
·
Raw
Materials (RM) inventory should always be a component of finished goods (FG)
because they are only stored for a short period prior to use in the factory.
·
Raw
materials (RM) consist of materials that a manager never inventories, since raw
material includes a component of work in process in the factory.
·
YOU WERE SURE AND CORRECT
Raw
materials (RM) inventory includes material maintained in storerooms at or near
the factory until the manager moves those materials to production.
·
Raw
materials consist of raw materials (RM) inventory even when those materials are
in process in the factory.
·
I DON'T KNOW YET
Learn
QUESTION
Job
593 was recently completed. The following data have been recorded on its job
cost sheet:
|
Direct materials
|
$3,190
|
|
|
Direct labor-hours
|
71
|
labor-hours
|
|
Direct labor wage rate
|
$15
|
per labor-hour
|
|
Machine-hours
|
175
|
machine-hours
|
The
corporation applies manufacturing overhead on the basis of machine-hours. The
predetermined overhead rate is $14 per machine-hour.
Which
of the following should the manager record as the total cost on the job cost
sheet for Job 593?
ANSWER
Correct
·
$4,255
·
$3,219
·
YOU WERE SURE AND CORRECT
$6,705
·
$5,249
·
I DON'T KNOW YET
Managers
use which of the following calculations to find the predetermined manufacturing
overhead (MOH)?
ANSWER
INCORRECT
·
Total
estimated manufacturing overhead costs / Total actual amount of the allocation
base
·
Total
actual manufacturing overhead costs / Total actual amount of the allocation
base.
·
YOU WERE SURE AND INCORRECT
Total
actual manufacturing overhead costs / Total estimated amount of the allocation
base
·
THE
CORRECT ANSWER
Total
estimated manufacturing overhead costs / Total estimated amount of the
allocation base
·
I DON'T KNOW YET
WHAT YOU NEED TO KNOW
The
predetermined MOH rate calculation is total estimated manufacturing
overhead costs / total estimated amount of the allocation base.
Managers
use the rate during the year. Managers do not revise the MOH rate unless the
company finds that either the manufacturing overhead costs or the total amount
of the allocation base used in the factory shifts away from the estimated
amounts. Managers that experience shifts from the estimated amount may revise
the rate during the year.
Underallocated
manufacturing overhead means the ________.
ANSWER
INCORRECT
·
estimated
manufacturing overhead cost was greater than the allocated manufacturing
overhead cost
·
YOU WERE SURE AND INCORRECT
allocated
manufacturing overhead cost was greater than the actual manufacturing overhead
cost
·
THE
CORRECT ANSWER
allocated
manufacturing overhead cost was less than the actual manufacturing overhead cost
·
estimated
manufacturing overhead cost was greater than the actual manufacturing overhead
cost
·
I DON'T KNOW YET
WHAT YOU NEED TO KNOW
Underallocated
manufacturing overhead means the allocated manufacturing
overhead cost was less than the actual manufacturing overhead cost.
Athens
Machining had one job in Work in Process Inventory at the beginning of the
month: Job 1376. Athens has a predetermined overhead rate of $14.00 per direct
labor hour. The total direct labor hours were 160 direct labor hours.
How
much manufacturing overhead (MOH) should the manager allocate to Job 1376?
ANSWER
INCORRECT
·
$46,400
·
YOU WERE SURE AND INCORRECT
$44,200
·
THE
CORRECT ANSWER
$2,240
·
$1,120
·
I DON'T KNOW YET
WHAT YOU NEED TO KNOW
The
MOH allocated to Job 1376 for the month is $2,240. [$14.00 per direct labor hour
x 160 direct labor hours]. The other answers are incorrect.
Artsy
Sportswear manufactures a specialty line of silk-screened T-shirts. The company
uses a job-order costing system. During May, the manager incurred the following
costs on Job PS4: direct materials $27,400 and direct labor $9,600. In
addition, the manager incurred selling and shipping costs of $14,000. The
manager applied manufacturing overhead at the rate of $25 per machine-hour and
Job PS4 required 160 machine-hours.
What
was the cost of goods sold per shirt if Job PS4 consisted of 5,000 shirts?
ANSWER
INCORRECT
·
THE
CORRECT ANSWER
$8.20
·
YOU WERE SURE AND INCORRECT
$7.40
·
$11.00
·
$25.00
·
I DON'T KNOW YET
WHAT YOU NEED TO KNOW
The
cost of goods sold per shirt if Job PS4 consisted of 5,000 shirts equates to $8.20 / shirt. The calculation to solve the
problem is:
[DM
($27,400) + DL ($9,600) + MOH allocated ($25 x 160 MHR)]/ 5,000 shirts
=
[$27,400 + $9,600 + $4,000]/5,000
=
$41,000/5000 = $8.20/shirt
The
other answers are incorrect.
Brockton
Corporation, which allocates manufacturing overhead on the basis of
machine-hours, has provided the following data for its most recent year of
operations.
|
Actual manufacturing overhead costs incurred
|
$35,000
|
|
Manufacturing overhead allocated to jobs
|
33,800
|
|
Underallocated or overallocated Manufacturing overhead
|
?
|
Calculate
the manufacturing overhead and indicate if the remainder is underallocated or
overallocated for the year.
ANSWER
INCORRECT
·
THE
CORRECT ANSWER
$1,200
underallocated
·
$1,348
underallocated
·
YOU WERE SURE AND INCORRECT
$732
overallocated
·
$732
underallocated
·
I DON'T KNOW YET
WHAT YOU NEED TO KNOW
The
overhead for the year was $1,200 underallocated. The computation is:
|
Actual manufacturing overhead costs incurred
|
$35,000
|
|
Less: allocated overhead
|
33,800
|
|
Underallocated manufacturing overhead
|
$1,200
|
The
other answer choices are not correct.
Overallocation
of overhead occurs when ________.
ANSWER
Correct
·
the actual overhead rate is
greater than the budgeted overhead rate
·
YOU WERE SURE AND CORRECT
the manufacturing overhead
account has a credit balance at the end of the period
·
the overhead rate is material
·
the actual overhead rate is
greater than the rate used in prior periods
·
I DON'T KNOW YET
Athens Machining had one job in Work in
Process Inventory at the beginning of the month: Job 1376. Athens has a
predetermined overhead rate of $14.00 per direct labor hour. The total direct
labor hours were 160 direct labor hours.
How
much manufacturing overhead (MOH) should the manager allocate to Job 1376?
ANSWER
INCORRECT
·
THE CORRECT ANSWER
$2,240
·
$44,200
·
$46,400
·
YOU WERE SURE AND INCORRECT
$1,120
·
I DON'T KNOW YET
WHAT YOU NEED TO KNOW
The
MOH allocated to Job 1376 for the month is $2,240. [$14.00 per direct labor hour x 160 direct
labor hours]. The other answers are incorrect.
Chelsea, Inc. uses the job costing method and
uses direct labor hours as the allocation base. In 2016, the total estimated
and actual overhead costs for Job 3489 were $250,000 and $275,000,
respectively. The total estimated and actual direct labor hours for Job 3489
were 25,000 and 28,000, respectively.
Which
of the following represents the MOH allocated to Job 3489?
ANSWER
INCORRECT
·
$275,000
·
$308,000
·
YOU WERE SURE AND INCORRECT
$250,000
·
THE CORRECT ANSWER
$280,000
·
I DON'T KNOW YET
WHAT YOU NEED TO KNOW
The
amount of MOH allocated to Job 3489 is $280,000. The company calculates its predetermined
manufacturing overhead (MOH) rate as follows:
Predetermined
MOH rate = Total estimated manufacturing overhead costs / Total estimated
amount of the allocation base
=
$250,000 / 25,000 DLH
=
$10
Next,
the company applies the MOH to the job as follows:
MOH
allocated to job = Predetermined MOH rate × Actual amount of allocation base
used by the job
=
$10 × 28,000 DLH
= $280,000
The
other answer choices are not correct.
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