Andrew Industries purchased $165,000 of raw materials on account during the month of March. The beginning Raw Materials Inventory balance was $22,000, and the materials used to complete jobs during the month were $141,000 direct materials and $13,000 indirect materials. What amount will Andrew transfer to Work In Process Inventory for the month of March?
A source document that an employee uses to report how much time was spent working on a job or on overhead activities and that is used to determine the amount of direct labor to charge to the job or to determine the amount of indirect labor to charge to factory overhead is called a:
Factory Overhead Ledger.
Factory payroll record.
The B&T Company’s production costs for May are: direct labor, $13,000; indirect labor, $6,500; direct materials, $15,000; property taxes on production equipment, $800; heat, lights and power, $1,000; and insurance on plant and equipment, $200. B&T Company’s factory overhead incurred for May is:
CWN Company uses a job order costing system and last period incurred $80,000 of actual overhead and $100,000 of direct labor. CWN estimates that its overhead next period will be $75,000. It also expects to incur $100,000 of direct labor. If CWN bases applied overhead on direct labor cost, its predetermined overhead rate for the next period should be:
The amount by which the overhead applied to jobs during a period exceeds the overhead incurred during the period is known as:
The ending inventory of finished goods has a total cost of $9,000 and consists of 600 units. If the overhead applied to these goods is $3,000, and the overhead rate is 75% of direct labor, how much direct materials cost was incurred in producing these units?
A type of production that yields customized products or services for each customer is called:
Job order production.
Job lot production.
Customer orientation production.
The overhead cost applied to a job during a period is recorded with a credit to Factory Overhead and a debit to:
Cost of Goods Sold.
Jobs Overhead Expense.
Work in Process Inventory.
Finished Goods Inventory.
A document in a job order costing system that is used to record the costs of producing a job is a(n):
Finished goods summary.
Job cost sheet.
Process cost system.
Minstrel Manufacturing uses a job order costing system. During one month Minstrel purchased $198,000 of raw materials on credit; issued materials to production of $195,000 of which $30,000 were indirect. Minstrel incurred a factory payroll of $150,000, paid in cash, of which $40,000 was indirect labor. Minstrel uses a predetermined overhead application rate of 150% of direct labor cost. Minstrel’s beginning and ending Work in Process Inventory are $15,500 and $27,000 respectively. Compute the cost of product transferred to Finished Goods Inventory:
A materials requisition is a source document used by materials managers of a manufacturing company to order raw materials from suppliers; it serves the same purpose as a purchase order in a merchandising company.
Material amounts of under- or overapplied factory overhead are always closed entirely to Cost of Goods Sold at the end of an accounting period.
Job order costing is applicable to manufacturing firms only and not service firms.
Job order costing systems normally use:
Real inventory systems.
Perpetual inventory systems.
Periodic inventory systems.
General inventory systems.
Any inventory systems is acceptable.
In comparison to a general accounting system, a cost accounting system for a manufacturing company places an emphasis on:
Continually updating costs of materials, work in process, and finished goods inventories.
Large volume operations involving standardized products.
Products and average costs.
Periodic inventory counts.
If overhead applied is less than actual overhead incurred, it is:
Both direct and indirect labor costs are recorded on the individual job cost sheets.
The production activities for a customized product represent a(n):
There are two basic types of cost accounting systems: job order costing and periodic costing.
Job cost sheets are used to track all of the costs assigned to a job, including direct materials, direct labor, overhead, and all selling and administrative costs.