Job Order Costing System - Cost Accounting - Quiz, Exercises of Cost Accounting

Download Job Order Costing System - Cost Accounting - Quiz and more Exercises Cost Accounting in PDF only on Docsity! Cost Accounting 1. A company that manufactures sugar will use a _____________________ costing system to track production costs 2. In a normal job order costing system, factory overhead is applied using ___________ rates times ________ input. 3. When raw materials are placed into production, the ______________________ account is debited 4. When indirect labor is recorded for a job in process, ___________________________ is debited. 5. If a substandard product cannot be reworked, it is known as ______________. 6. Underapplied factory overhead that is immaterial in amount is closed to ______________________ at year end. 7. An activity that does not increase the value of a product for a customer is referred to as a _______________________ activity. DIF: Easy OBJ: 5-1 8. The proportion of value added processing time to total cycle time equals ________________________________. DIF: Easy OBJ: 5-2 9. In a job order costing system, a. standards cannot be used. b. an average cost per unit within a job cannot be computed. c. costs are accumulated by departments and averaged among all jobs. d. overhead is typically assigned to jobs on the basis of some cost driver. 10. Which of the following costing methods of valuation are acceptable in a job order costing system? Actual Material Cost Standard Material Cost Actual Labor Cost Predetermined Overhead Cost a. yes yes no yes b. yes no yes no c. no yes yes yes d. yes yes yes yes 11. Job order costing and process costing have which of the following characteristics? Job Order Costing Process Costing a. homogeneous products heterogeneous products and large quantities and small quantities b. homogeneous products heterogeneous products and small quantities and large quantities c. heterogeneous products homogeneous products and large quantities and small quantities d. heterogeneous products homogeneous products and small quantities and large quantities 12. Which of the following journal entries records the accrual of the cost of indirect labor used in production? a. debit Work in Process Inventory, credit Wages Payable Docsity.com b. debit Work in Process Inventory, credit Manufacturing Overhead c. debit Manufacturing Overhead, credit Work in Process Inventory d. debit Manufacturing Overhead, credit Wages Payable 13. Underapplied overhead resulting from unanticipated and immaterial price increases for overhead items should be written off by a. decreasing Cost of Goods Sold. b. increasing Cost of Goods Sold. c. decreasing Cost of Goods Sold, Work in Process Inventory, and Finished Goods Inventory. d. increasing Cost of Goods Sold, Work in Process Inventory, and Finished Goods Inventory. 14. .In a job order costing system, the net cost of normal spoilage is equal to a. estimated disposal value plus the cost of spoiled work. b. the cost of spoiled work minus estimated spoilage cost. c. the units of spoiled work times the predetermined overhead rate. d. the cost of spoiled work minus the estimated disposal value. 15. .If abnormal spoilage occurs in a job order costing system, has a material dollar value, and is related to a specific job, the recovery value of the spoiled goods should be debited to credited to a. a scrap inventory account the specific job in process b. the specific job in process overhead c. a loss account the specific job in process d. factory overhead sales 16. Which of the following is/are part of activity-based management? Activity analysis Cost driver analysis a. yes yes b. no yes c. no no d. yes no 17. The sum of the non-value-added time and the value-added time equals a. inspection time. b. production time. c. the product life cycle. d. cycle time. 18. When a firm redesigns a product to reduce the number of component parts, the firm is a. increasing consumer value. b. increasing the value added to the product. c. decreasing product variety. d. decreasing non-value-added costs. 19. In allocating variable costs to products, a. a volume-based cost driver should be used. b. direct labor hours should always be used as the allocation base. c. a company should use the same allocation base that it uses for fixed costs. d. a company should never use more than one cost driver. 20. Product costing systems in use over the last 40 years a. concentrated on using multiple cost pools and cost drivers. b. were often technologically incapable of handling activity-based costing information. c. have generally been responsive to changes in the manufacturing environment. Docsity.com $2,000/56,000 = $0.0357 DIF: Moderate OBJ: 5-3 29. Refer to Phelps Company. Assume that Phelps Company has decided to allocate overhead costs using levels of cost drivers. What would be the approximate per-unit set-up cost for the blue units of Product Z? a. $.04. b. $.25. c. $.50. d. None of the responses are correct. DIF: Moderate OBJ: 5-3 30. Refer to Phelps Company. Assume that Phelps Company has decided to allocate overhead costs using levels of cost drivers. What would be the approximate per-unit set-up cost for the green units of Product Z? a. $1.00. b. $0.25. c. $0.04. d. None of the responses are correct. Setup cost = $500.00 Units produced = 500 $500.00/500 = $1.00/unit DIF: Moderate OBJ: 5-3 Steel Company. Steel Company uses a job order costing system and develops its predetermined overhead rate based on machine hours. The company has two jobs in process at the end of the cycle, Jobs #177 and #179. Budgeted overhead $100,300 Budgeted machine hours 85,000 Raw material $ 63,000 Labor cost $ 50,000 31. Refer to Steel Company. What amount of overhead is charged to Jobs #177 and #179? Machine hours are split between Jobs #177 and #179-65 percent and 35 percent, respectively. Actual machine hours equal budgeted machine hours. DIF: Easy OBJ: 4-4 32. Refer to Steel Company. Fifty-four percent of raw material belongs to Job 17 and 38 percent belongs to Job 179, and the balance is considered indirect material. What amount of raw material used was allocated to overhead as indirect material? 54% + 38% = 92%; this means that 8% is indirect or $5,040 (.08 × $63,000). DIF: Easy OBJ: 4-4 Docsity.com 33. Refer to Steel Co. Labor cost was split 25 percent and 70 percent, respectively, between Jobs #177 and #179 for direct labor. The remainder was indirect labor cost. What are the total costs of Jobs #177 and #179? 34. ABC has been criticized for a variety of reasons. Discuss these criticisms. DIF: Moderate OBJ: 5-6 Docsity.com