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Exam 10: Accounting for Manufacturing Operations

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Question 41

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The current year's advertising costs are normally considered as product costs.

A) True
B) False

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Question 42

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One of the ways in which just-in-time processing is accomplished in manufacturing and non-manufacturing processes is by:

A) moving a product from process to process as each function is completed.
B) combining processing functions into work centers and cross-training workers to perform more than one function.
C) having production supervisors attempt to enter enough materials into manufacturing to keep all manufacturing departments operating.
D) having workers typically perform one function on a continuous basis.

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

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Question 43

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Non-manufacturing costs are generally classified into two categories: selling and administrative.

Which of the following is a period cost?

Which of the following is true of job order cost systems?

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

For an automotive repair shop, the wages of mechanics would be classified as direct labor cost.

A job order cost system provides for a separate record of the costs for each particular quantity of product that is manufactured.

The summary of the time tickets at the end of each month is the basis for recording the direct and indirect labor costs incurred in production.

Hudson, Inc.has estimated total factory overhead costs of $400,000 and 20,000 direct labor hours for the current fiscal year.If direct labor hours for the year totals 18,000 and actual factory overhead totals $350,000, what is the amount of overapplied or underapplied overhead for the year?

The recording of the jobs completed would decrease:

The recording of the jobs shipped and customers billed would increase:

Which of the following costs appear on a balance sheet?

Direct materials, work-in-process, and finished goods inventory are most likely to be reported on the balance sheet of a(n) :

Indirect labor is included in factory overhead.

The following information is available for the first month of operations for Bluemoon, Inc.: $\begin{array}{|l|r|}\hline \text { Sales } & \$ 850,000 \\\hline \text { Gross profit } & 330,000 \\\hline \text { Indirect labor } & 35,000 \\\hline \text { Indirect materials } & 14,000 \\\hline \text { Other factory overhead } & 9,000 \\\hline \text { Materials purchased } & 360,000 \\\hline \text { Total manufacturing costs } & 670,000 \\\hline \text { Materials inventory, end of period } & 20,000 \\\hline\end{array}$ ? Based on the information provided for Bluemoon, Inc., calculate the cost of goods sold.

A _____ is prepared when materials that have been ordered are received and inspected.

A manufacturing business converts materials into finished products through the use of machinery and labor.

Upon completing a job, direct materials totaled $4,500; direct labor, $2,500; and factory overhead, $3,500.Units produced totaled 2,100.What is the per unit cost?

Loise Inc., a manufacturing company, forecasts that total overhead for the current year will be $19,250,000, and total machine hours will be 350,000 hours.However, the actual overhead is $6,095,000, and the actual machine hours are 142,000 hours.If the company uses a predetermined overhead rate based on machine hours for applying overhead, what is the predetermined overhead rate?