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Exam 2: Job Order Costing

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Question 21

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The entries to record cost and sale of a finished good on account is

A) debit Cost of Goods Sold, credit Finished Goods
B) debit Cost of Goods Sold, credit Finished Goods, debit Accounts Receivable, credit Sales
C) debit Sales Expense, credit Finished Goods, credit Cash, credit Accounts Receivable
D) debit Work in Process, credit Finished Goods, debit Accounts Receivable, credit Sales

E) C) and D)
F) A) and B)

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Question 22

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

A) True
B) False

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Question 23

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The amount of time spent by an employee on an individual job are recorded on

On May 15, the stamping department accepted Job 051507A to make 1,000 funnels. Materials requisitioned were 1,100 sheets at $1.20 per sheet and 1,150 grommets at $0.15 per set. The cost driver used by stamping department is the drop-forge strokes indicated by a machine mounted counter. Overhead is applied at $2.25 for each drop-forge stroke.  Additionally, $375.00 of overhead is applied to each job due to setup and tear down. Direct labor is applied at $22.50 per hour for the machine operator and $11.10 for the machine loader. The job required 6.5 hours of labor. Upon completion, the job was transferred to Finished Goods Inventory. Journalize all events as of May 15.

For which of the following businesses would the job order cost system be appropriate?

On November 2, Newsprint Manufacturing purchases 5 rolls of paper on account at $125 per roll for use within the production process. On November 5, 4 rolls of this paper are issued to Job 157A in the Printing Department. The Printing Department records $675 in direct labor and $1,150 of factory overhead to Job 157A. On November 8, Printing transfers Job 157A to the Folding Department. The Folding Department applies $450 in direct labor and $655 in factory overhead to Job 157A. Job 157A is transferred to Finished Goods inventory on November 9. (a) Journalize the purchase of the paper. (b) Journalize the transfer of raw materials to work in process, the application of direct labor, and the application of manufacturing overhead to Job 157A while in the Printing Department. (c) Journalize the transfer of Job 157A to the Folding Department at actual cost. (d) Journalize the application of direct labor and the application of manufacturing overhead to Job 157A while in the Folding Department. (e) Journalize the transfer of Job 157A to Finished Goods Inventory at actual cost.

Which of the following costs are not included in finished goods inventory?

Activity-based costing is a method of accumulating and allocating costs by department.

In a job order cost accounting system, the entry to record the flow of direct materials into production is to

A summary of the time tickets for August follows: Present the journal entries to record: (a) the labor cost incurred (b) the application of factory overhead to production for August. The factory overhead rate is 70% of direct labor cost

The job order costing system is used by service firms to determine revenues, expenses, and ultimately profit.

During April, Cavy Company incurred factory overhead as follows: Record the entry for factory overhead incurred during April.

Perpetual inventory controlling accounts and subsidiary ledgers are maintained for materials, work in process, and finished goods in job order costing systems.

Put the following in the order of the flow of manufacturing costs for a company. a. Closing under/overapplied factory overhead to Cost of Goods Sold b. Materials purchased c. Factory labor used and factory overhead incurred in production d. Completed jobs moved to finished goods e. Factory overhead applied to jobs according to the predetermined overhead rate f. Materials requisitioned to jobs g. Selling of finished product h. Preparation of financial statements to determine gross profit

Selected accounts with a credit amount omitted are as follows What was the balance of Work in Process as of April 30?

Six selected transactions for the current month are indicated by letters in the following T accounts in a job order cost accounting system: Describe each of the six transactions.

Adams Company is a manufacturing company that has worked on several production jobs during the first quarter of the year.  Below is a list of all the jobs for the quarter: Jobs 356, 357, 358, and 359 were completed.  Jobs 356 and 357 were sold at a profit of $500 on each job. What is the gross profit for Adams Company at the end of the first quarter?

Which of the following would not be found in the accounting system of a service provider?

Adams Company is a manufacturing company that has worked on several production jobs during the first quarter of the year.  Below is a list of all the jobs for the quarter: Jobs 356, 357, 358, and 359 were completed.  Jobs 356 and 357 were sold at a profit of $500 on each job. What is the ending balance of Cost of Goods Sold for Adams Company at the end of the first quarter?

The Thomlin Company forecasts that total overhead for the current year will be $15,500,000 with 250,000 total machine hours. Year to date, the actual overhead is $16,000,000 and the actual machine hours are 330,000 hours. The predetermined overhead rate based on machine hours is