ACCT2102 Practice Quiz- Ch. 2 – Flashcards

1. Which of the following statements is correct concerning job-order costing? a. Job-order costing would be appropriate for an automobile repair shop. b. All the costs appearing on a job cost sheet are actual costs. c. Indirect materials are charged to a specific job. d. Job-order costing is mainly used in firms with mass production of a homogeneous product such as oil refineries.

2. What source document is used to determine the actual amount of direct materials to record on a job cost sheet? a. bill of materials b. production order c. materials purchase order d. materials requisition form

3. In a job-order costing system, the application of manufacturing overhead would be recorded as a debit to: a. Manufacturing Overhead inventory. b. Finished Goods inventory. c. Work in Process inventory. d. Cost of Goods Sold.

4. Heller Cannery, Inc., uses a predetermined overhead rate based on machine-hours to apply manufacturing overhead to jobs. The company estimated that it would incur $510,000 in manufacturing overhead during the year and that it would work 100,000 machine-hours. The company actually worked 105,000 machine-hours and incurred $540,000 in manufacturing overhead costs. By how much was manufacturing overhead underapplied or overapplied for the year? a. $4,500 overapplied b. $4,500 underapplied c. $30,000 overapplied d. $30,000 underapplied

5. Which of the following would usually be found on a job cost sheet under a normal cost system? Actual direct material cost_ Actual MOH a. Yes................................................ Yes b. Yes................................................ No c. No................................................. Yes d. No................................................. No

6. In a predetermined overhead rate in a job-order costing system that is based on machine-hours, which of the following would be used in the numerator and denominator? Numerator ______________ Denominator a. Actual MOH ................... Actual Machine hrs b. Actual MOH .................. Est. Machine Hrs c. Est. MOH ....................... Actual Machine hrs d. Est. MOH ...................... Est. Machine hrs

Job 910 was recently completed. The following data have been recorded on its job cost sheet: Direct Materials.................. $3,193 Direct Labor Hours............ 21 Labor Hours Direct Labor Wage Rate.... $12 per labor hr Machine Hours................... 166 Machine hrs The company applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $15 per machine-hour. The total cost that would be recorded on the job cost sheet for Job 910 would be: a. $3,220 b. $3,760 c. $5,935 d. $3,445

Washtenaw Corporation uses a job-order costing system. The following data is for last year: Est. Direct Labor Hrs........ 12,000 Est. MOH Costs................. $39,000 Actual Direct Labor Hrs.... 11,000 Actual MOH Costs............. $37,000 Washtenaw applies overhead using a predetermined rate based on direct labor-hours. What amount of overhead was applied to work in process last year? a. $39,050 b. $42,600 c. $35,750 d. $36,960

Reamer Company uses a predetermined overhead rate based on machine-hours to apply manufacturing overhead to jobs. The company has provided the following estimated costs for the next year: Direct Materials................................ $1,000 Direct Labor...................................... $3,000 Sales Commissions.......................... $4,000 Salary of Production supervisor..... $2,000 Indirect Materials............................. $400 Advertising expense........................ $800 Rent on Factory Equipment............ $1,000 Reamer estimates that 500 direct-labor hours and 1,000 machine-hours will be worked during the year. The predetermined overhead rate per hour will be: a. $6.80 b. $6.00 c. $3.00 d. $3.40