ACCT 211 – Chapter 19 (NOT GRADED) – Flashcards

A process cost accounting system provides for a separate record of the cost of each particular quantity of product that passes through the factory.

A job order cost system would be appropriate for a crude oil refining business.

A law firm would use a job order cost system to accumulate all of the costs associated with a particular client engagement, such as lawyer time, copying charges, filing fees, and overhead.

When the goods are sold, their costs are transferred from Work in Process to Finished Goods.

Materials are transferred from the storeroom to the factory in response to materials requisitions.

The document that serves as the basis for recording direct labor on a job cost sheet is the time card.

Depreciation expense on factory equipment is part of factory overhead cost.

If factory overhead applied exceeds the actual costs, the factory overhead account will have a credit balance.

Nonmanufacturing costs are generally classified into two categories: selling and administrative.

Direct labor cost is an example of a period cost.

A manufacturing business reports just two types of inventory on its balance sheet: work in process inventory and finished goods inventory.

As product costs are incurred in the manufacturing process, they are accounted for as assets and reported on the balance sheet as inventory.

Job order cost systems can be used to compare unit costs of similar jobs to determine if costs are staying within expected ranges.

Job order cost accounting systems may be used for planning and controlling a service business.

Job order cost accounting systems can be used only for companies that manufacture a product.

1. 1 Which of the following is most associated with financial accounting?

2. 2 What term is used to describe the process of monitoring operating results and comparing actual results with the expected results?

3. 3 The cost of a manufactured product generally consists of which of the following costs?

4. 4 Which of the following is an example of a factory overhead cost?

5. 5 Which of the following costs are referred to as conversion costs?

6. 6 Which of the following accounts will be found on the income statement?

7. 7 Cost of Materials Used $45,000 Direct Labor costs $48,000 Factory Overhead $39,000 Work in Process, beg. $28,000 Work in Process, end. $18,000 What is Cost of Goods Manufactured?

8. 8 Beginning Raw Materials Inventory $40,000 Materials purchased $65,000 Ending Raw Materials Inventory $30,000 What is the amount of Raw Materials Used?

9. 9 Accounting designed to meet the needs of decision-makers inside the business is referred to as:

10. 10 Goods that are partially completed by a manufacturer are referred to as:

11. 11 Indirect labor and indirect materials are classified as:

12. 12 Factory overhead includes:

13. 13 Williams Company reports production costs for 2015 as follows: Direct materials used $345,000 Direct labor incurred $250,000 Factory overhead incurred $400,000 Operating expenses $175,000 Williams Company's period costs for 2015 amount to:

14. 14 Williams Company reports production costs for 2015 as follows: Direct materials used $345,000 Direct labor incurred $250,000 Factory overhead incurred $400,000 Operating expenses $175,000 Williams Company's product costs for 2015 amount to:

15. 15 Cost of goods manufactured is equal to:

16. 16 Finished goods inventory is reported on the:

17. 17 Which of the following is the correct flow of manufacturing costs?

18. 18 The recording of the jobs shipped and customers billed would include a debit to:

19. 19 A manufacturing company applies factory overhead based on direct labor hours. At the beginning of the year, it estimated that factory overhead costs would be $360,000 and direct labor hours would be 30,000. Actual factory overhead costs incurred were $377,200, and actual direct labor hours were 36,000. What is the amount of overapplied or underapplied manufacturing overhead at the end of the year?

20. 20 A separate account for each material is found in a

21. 21 A difference in quantity of materials used on two comparable jobs may be caused by:

22. 22 Cost of Goods Sold, Cost of Goods Manufactured Piper Company has the following information for December: Cost of direct materials - used in production $49,000 Direct labor $59,000 Factory overhead $30,000 Work in process inventory, Dec 1 $41,000 Work in process inventory, Dec 31 $48,000 Finished goods inventory, Dec 1 $26,000 Finished goods inventory, Dec 31 $18,000 a. For December, determine the cost of goods manufactured. b. For December, determine the cost of goods sold.

23. 23 Recording Materials Transactions April 16 1,600 lbs clay for $1.80 per lb April 18 650 lbs clay released for production

24. 24 Fill in the blank: _____ costs include commissions on sales, the salary of the chief executive officer, and the depreciation on the computers used in the Accounting Department. _____ costs include the salary of the plant supervisor and the supplies used to clean the production facilities. _____ costs are further classified as direct material costs, direct labor costs, and factory overhead costs. Product or Period? 1. Salary of factory maintenance supervisor 2. Life insurance on CEO and CFO 3. Thread 4. Salary of sales manager 5. Labor cost for cutting machine operators 6. Workers' compensation insurance for factory workers 7.Labor cost for human resources department 8. Salary of company CFO 9. Terry cloth fabric 10. Cost of shipping products to customers Next Level Product & Period Costs 1. Salary of factory maintenance supervisor 2. Life insurance on CEO and CFO 3. Thread 4. Salary of sales manager 5. Labor cost for cutting machine operators 6. Workers' compensation insurance for factory workers 7.Labor cost for human resources department 8. Salary of company CFO 9. Terry cloth fabric 10. Cost of shipping products to customers

25. 25 Entry for Factory Labor Costs A summary of the time tickets for the current month follows: Job No. Amount 201 $2,700 204 $2,240 205 $4,100 Indirect labor $14,390 220 $4,750 224 $2,900 228 $1,900 236 $12,870 Journalize the entry to record the factory labor costs. If an amount box does not require an entry, leave it blank.

26. 26 Cost of Goods Manufactured for a Manufacturing Company The following information is available for O'Neal Manufacturing Company for the month ending January 31, 2014: Cost of direct materials - used in production $127,700 Direct labor $153,200 Work in process inventory, January 1 $57,500 Work in process inventory, January 31 $77,900 Total factory overhead $70,200 Determine O'Neal's cost of goods manufactured for the month ended January 31, 2014.