Question 1

The cost of wages paid to employees directly involved in the manufacturing process in converting materials into finished product is classified as

Accepted Answer

A)  factory overhead cost.
B)  direct labor cost.
C)  wages expense.
D)  direct materials cost.E) B) and C)
F) A) and B)

Question 2

Companies recognizing the need to simultaneously produce products with high quality,low cost,and instant availability can adopt a just- in-time processing philosophy.

Accepted Answer

A) True 
 B)False

Question 3

Depreciation expense on factory equipment is part of factory overhead cost.

Accepted Answer

A) True 
 B)False

Question 4

Compute factory overhead cost from the following costs:

Accepted Answer

A)  $23,000
B)  $43,000
C)  $70,000
D)  $113,000E) B) and C)
F) A) and B)

Question 5

The period costs of a textbook printer would include

Accepted Answer

A)  wages of a press operator.
B)  utility costs of the factory.
C)  advertising expenses.
D)  paper costs.E) A) and D)
F) A) and C)

Question 6

Which of the following is FALSE in regards to direct materials for an auto manufacturer?

Accepted Answer

A)  Steel would probably be a direct material.
B)  Upholstery fabric would probably be a direct material.
C)  Oil to lubricate factory machines would not be a direct material.
D)  Small plastic clips to hold on door panels,because they become part of the auto,must be accounted for as direct materials.E) C) and D)
F) All of the above D

Question 7

Just-in-time manufacturing uses which of the following techniques?

Accepted Answer

A)  Provides specialized training so that employees only do one task and work individually to improve efficiencies in the department
B)  Organizes the plant in such a way as to reduce product movement from station to station
C)  Encourages management to make all operating decisions regarding the manufacturing process rather than the line employees in order to streamline the process
D)  All of theseE) A) and B)
F) A) and C)

Question 8

The cost of materials entering directly into the manufacturing process is classified as factory overhead cost.

Accepted Answer

A) True 
 B)False

Question 9

The sale of a finished good on account

Accepted Answer

A)  increases Cost of Goods Sold and decreases Finished Goods.
B)  increases Cost of Goods Sold,decreases Finished Goods,increases Accounts Receivable,and increases Sales.
C)  increases Sales Expense,decreases Finished Goods,decreases Cash,and decreases Accounts Receivable.
D)  increases Work in Process,decreases Finished Goods,increases Accounts Receivable,and increases Sales.E) A) and D)
F) B) and C)

Question 10

Recording direct labor costs in a job order cost accounting system

Accepted Answer

A)  increases Factory Overhead,decreases Work in Process.
B)  increases Finished Goods,increases Wages Payable.
C)  increases Work in Process,increases Wages Payable.
D)  increases Factory Overhead,increases Wages Payable.E) C) and D)
F) B) and C) C

Question 11

The document authorizing the issuance of materials from the storeroom is the

Accepted Answer

A)  materials requisition.
B)  purchase requisition.
C)  receiving report.
D)  purchase order.E) C) and D)
F) B) and C)

Question 12

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.

Accepted Answer

A) True 
 B)False

Question 13

When Job 711 was completed,direct materials totaled $3,000;direct labor,$3,500;and factory overhead,$1,500.Units produced totaled 1,000.Unit costs are

Accepted Answer

A)  $8,000.
B)  $6,500.
C)  $6.50.
D)  $8.E) A) and C)
F) A) and B)

Question 14

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

Accepted Answer

A) True 
 B)False

Question 15

At the end of the year,overhead applied was $35,000,000.Actual overhead was $35,800,000.Closing over/under applied overhead into cost of goods sold would cause net income to

Accepted Answer

A)  increase by $800,000.
B)  decrease by $800,000.
C)  stay the same.
D)  decrease by $200,000.E) C) and D)
F) All of the above

Question 16

Direct materials costs are included in the conversion costs of a product.

Accepted Answer

A) True 
 B)False

Question 17

Job order costing and process costing are

Accepted Answer

A)  pricing systems.
B)  cost accounting systems.
C)  cost flow systems.
D)  inventory tracking systems.E) B) and C)
F) A) and D)

Question 18

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

Accepted Answer

A)  Direct labor
B)  Factory overhead
C)  Company president's salary
D)  Direct materialsE) C) and D)
F) A) and B) C

Question 19

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 total 18,000 and actual factory overhead totals $350,000,what is the amount of overapplied or underapplied overhead for the year?

Accepted Answer

A)  $10,000 overapplied
B)  $10,000 underapplied
C)  $50,000 underapplied
D)  $50,000 overappliedE) None of the above
F) C) and D)

Question 20

Which types of inventories does a manufacturing business report on its balance sheet?

Accepted Answer

A)  Finished goods inventory and work in process inventory
B)  Direct materials inventory and work in process inventory
C)  Direct materials inventory,work in process inventory,and finished goods inventory
D)  Direct materials inventory and finished goods inventoryE) A) and C)
F) B) and C)

Exam 10: Accounting Systems for Manufacturing Businesses

The cost of wages paid to employees directly involved in the manufacturing process in converting materials into finished product is classified as

Correct AnswerverifiedShow Answer

Companies recognizing the need to simultaneously produce products with high quality,low cost,and instant availability can adopt a just- in-time processing philosophy.

Correct AnswerverifiedShow Answer

Depreciation expense on factory equipment is part of factory overhead cost.

Correct AnswerverifiedShow Answer

Compute factory overhead cost from the following costs:

Correct AnswerverifiedShow Answer

The period costs of a textbook printer would include

Correct AnswerverifiedShow Answer

Which of the following is FALSE in regards to direct materials for an auto manufacturer?

Correct AnswerverifiedD

Just-in-time manufacturing uses which of the following techniques?

Correct AnswerverifiedShow Answer

The cost of materials entering directly into the manufacturing process is classified as factory overhead cost.

Correct AnswerverifiedShow Answer

The sale of a finished good on account

Correct AnswerverifiedShow Answer

Recording direct labor costs in a job order cost accounting system

Correct AnswerverifiedC

The document authorizing the issuance of materials from the storeroom is the

Correct AnswerverifiedShow Answer

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.

Correct AnswerverifiedShow Answer

When Job 711 was completed,direct materials totaled $3,000;direct labor,$3,500;and factory overhead,$1,500.Units produced totaled 1,000.Unit costs are

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

At the end of the year,overhead applied was $35,000,000.Actual overhead was $35,800,000.Closing over/under applied overhead into cost of goods sold would cause net income to

Correct AnswerverifiedShow Answer

Direct materials costs are included in the conversion costs of a product.

Correct AnswerverifiedShow Answer

Job order costing and process costing are

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedC

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 total 18,000 and actual factory overhead totals $350,000,what is the amount of overapplied or underapplied overhead for the year?

Correct AnswerverifiedShow Answer

Which types of inventories does a manufacturing business report on its balance sheet?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
D

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
C

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
C

Correct Answer
verified

Correct Answer
verified