: When completed units are
transferred to the warehouse:
Cost of Goods Sold account is debited.
Cost of Goods Manufactured account is
Finished Goods Inventory account is debited.
Work-in-Process Inventory account is debited.
Finished Goods Inventory account is credited.
Question 2. Question
: Which of the following
companies uses process costing systems?
Jiffy Lube International.
A professional service firm.
All of the above.
Question 3. Question
: Which one of the following is
the amount that actual factory overhead exceeds the factory overhead applied?
Factory overhead applied.
Actual factory overhead.
Allocated factory overhead.
Question 4. Question
: Abnormal spoilage:
Is considered part of good production.
Arises under efficient operating conditions.
Is controllable in the short run.
Is unacceptable spoilage that should not
occur under efficient operating conditions.
Is part of inventory product cost.
Question 5. Question
: An activity that is performed
to support the production of a new custom-order product is a(n):
Question 6. Question
: The general sales manager’s
salary is an example of a:
Customer unit-level cost.
Customer batch-level cost.
Question 7. Question
: Which of the following
activities is a facility-level activity?
Plant management salaries.
Depreciation on a highly specialized piece of
Question 8. Question
: Effective implementation of
activity-based costing (ABC) requires:
Normally the assistance of a consultant.
A sophisticated and expensive computer
Support of top management and key employees.
Capturing properly the complexity of the
ABC has no significant implementation issues.
Question 9. Question
: Process cost systems are used
in all of the following industries except:
Question 10. Question
: JIT (Just in time) methods are
designed primarily to:
Reduce inventory levels.
Improve product design.
Improve the accuracy of product costs.
Question 11. Question
: The journal entry to record
incurred direct labor would include a credit to:
Finished Goods Inventory.
Question 12. Question
: Transferred-in costs are costs
of work performed:
In the current department from last period
that are transferred in this period.
In the preceding department that are
transferred into the present department.
In a prior period that transferred in this
By an outside supplier of materials or labor.
Question 13. Question
: Wings Co. budgeted $555,600
manufacturing direct wages, 2,315 direct labor hours, and had the following
Overhead Cost Pool –
Budgeted O/H $ – Budgeted Level for
Cost Driver – O/H Cost Driver
3,200 lbs. Material
Machine Setup 13,200 390 S/Uâ€™s # of S/Us
1,380 30,000 Mach. Hrs Machine Hrs.
Inspections 10,560 160 Inspections # of Inspections
Requirements for Job #971 which included 4 Units of
D/L Hours = 20 Hours
D/Matâ€™ls = 130 lbs.
Machine S/U = 30 Set-ups
Machine Hrs. = 15,000 Machine Hours
Inspections = 15 Inspections.
Using ABC, overhead cost assigned to Job #971 for machine
Question 14. Question
: Stoltenberg Co. had the
following information for the month of June:
WIP Beginning Inventory â€“ June 1 = 2,000 Units
WIP Ending Inventory â€“ June 30 = 4,000 Units
Beginning work-in-process inventory is 30 percent complete
as to conversion. Ending work-in-process inventory is 50 percent complete as to
conversion. Materials are added at the end of the process.
How many units were started and completed in June?
Question 15. Question
: Randall Company manufactures
products to customer specifications. A job costing system is used to accumulate
production costs. Factory overhead cost was applied at 125% of direct labor
cost. Selected data concerning the past year’s operation of the company are
Direct Materials January 1 =
Direct Materials December 31 = 40,000
WIP January 1
WIP December 31
Finished Goods January 1 = 115,000
Finished Goods December
31 = 100,000
Direct Materials Purchased = $324,000
Cost of Goods Available for Sale =
Actual Factory Overhead = 206,000
The cost of goods manufactured during the year is: