Deck 17: Job Order Cost Systems and Overhead Allocations

Question 1

In a job order cost system, the sum of debits to the Work in Process controlling account during a particular period is equal to each of the following except:

A) The total of debits to the Materials Inventory, Direct Labor, and Manufacturing Overhead accounts during the period.
B) The total of direct materials, direct labor, and manufacturing overhead costs applied to jobs during the period.
C) The total of amounts entered on job cost sheets during the period.
D) The total of credits to the Materials Inventory, Direct Labor, and Manufacturing Overhead accounts during the period.

Answer 1

The total of debits to the Materials Inventory, Direct Labor, and Manufacturing Overhead accounts during the period.

Question 2

The Work in Process controlling account of a manufacturing firm shows a debit balance of $5,000 at the end of an accounting period. The job cost sheet of the two uncompleted jobs shows charges of $700 and $1,300 for materials used and charges of $400 and $600 for direct labor used. From this information, it appears that the company is using a predetermined factory overhead rate (as a percentage of direct labor cost) of:

A) 100%.
B) 200%.
C) 33%.
D) 50%.

Answer 2

200%.

Question 3

The use of activity-based costing is most appropriate for:

A) Firms that manufacture multiple product lines.
B) Firms that have very low manufacturing overhead costs relative to other costs of production.
C) Firms with high levels of production activity.
D) Firms that account separately for product and period costs.

Answer 3

Firms that manufacture multiple product lines.

Question 4

The information below is taken from the job cost sheets of O'Leary Company:
During November, job numbers 352 and 353 were completed and job numbers 350, 351 and 352 were delivered to customers. Jobs nos. 354 and 355 are still in process at November 30. From this information, compute the following:

-What is the work in process inventory at October 31? $__________

Question 5

The information below is taken from the job cost sheets of O'Leary Company:
During November, job numbers 352 and 353 were completed and job numbers 350, 351 and 352 were delivered to customers. Jobs nos. 354 and 355 are still in process at November 30. From this information, compute the following:
-What is the finished goods inventory at October 31? $__________

Question 6

The information below is taken from the job cost sheets of O'Leary Company:
During November, job numbers 352 and 353 were completed and job numbers 350, 351 and 352 were delivered to customers. Jobs nos. 354 and 355 are still in process at November 30. From this information, compute the following:
-What is the cost of goods sold during November? $__________

Question 7

The information below is taken from the job cost sheets of O'Leary Company:
During November, job numbers 352 and 353 were completed and job numbers 350, 351 and 352 were delivered to customers. Jobs nos. 354 and 355 are still in process at November 30. From this information, compute the following:
-What is the work in process inventory at November 30? $__________

Question 8

The information below is taken from the job cost sheets of O'Leary Company:
During November, job numbers 352 and 353 were completed and job numbers 350, 351 and 352 were delivered to customers. Jobs nos. 354 and 355 are still in process at November 30. From this information, compute the following:
-What is the finished goods inventory at November 30? $__________