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Exam 16: Costing Systems: Job Order Costing

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Question 21

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In cost-plus contracts,a predetermined amount of profit is added to the cost of the contract.

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Question 22

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When a job has been completed,all of the costs assigned to that job are moved to the Cost of Goods Sold account.

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Question 23

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The balances on the job cost sheets of uncompleted jobs will be equal to the balance in the

The following information is available at the end of May: If $72,400 of materials were charged to Job 88's job cost card,how much overhead was applied to Job 88?

In a service organization using a job order costing system,actual overhead will be the same as applied overhead.

Which of the following entities would probably use a process costing system?

Morgan & Morgan is a small firm that assists clients in the preparation of their tax returns.The firm has five accountants and five researchers,and it uses job order costing to determine the cost of each client's return.The firm is divided into two departments: (1)Preparation and (2)Research & Planning.Each department has its own overhead application rate.The Preparation Department's rate is based on accountant labor costs and Research & Planning is based on the number of research hours.The following is the company's estimates for the current year's operations. Client No.2006-713 was completed during April of the current year and incurred the following costs and hours: a.Compute the overhead rates to be used by both departments. b.Determine the cost of Client No.2006-713,by department and in total.

Unit costs for each job are computed by dividing

Quickwork Company uses a job order costing system.On March 1,Quickwork Company's Work in Process Inventory account shows a beginning balance of $170,000.Production activity for March was as follows: Materials costing $85,000,along with operating supplies of $20,000,were requisitioned into production.Quickwork Company's total payroll was $350,000,of which $75,000 was indirect labor.Overhead is applied at a rate of 125 percent of direct labor cost.Quickwork's Cost of Goods Sold for the month of May was $692,000.Finished Goods Inventory was $71,500 on March 1 and $84,000 on March 31.(Quickwork does not close out overhead accounts until year-end. ) a.Calculate Quickwork's cost of goods completed for March. b.Calculate Quickwork's work in process ending inventory (March 31). c.One of the jobs that was started in March,Job 208,was completed in April.Job 208 was 250 special-order decorative lamps.The following costs had been applied to Job 208 as of April 1: direct materials,$1,500;direct labor,$2,000;overhead,$2,500.In April,$580 in direct materials cost and $900 of direct labor cost were added to complete Job 208.What was the cost per unit for Job 208? (Show your computations. )

The ending balance in the Work in Process Inventory account equals the ending Overhead balance.

The total of the dollar amounts on the job order cost cards that have not been completed would be equal to the

Service organizations use unit costs of services to determine inventory balances.

Which of the following products would probably use a job order costing system?

Which of the following is a manager likely to do while preparing internal performance evaluation reports?

Ad-on International is an advertising company.It estimated the overhead costs for March,2014,to be $950,000 and direct labor hours to be 5,000 hours.In March,it incurred overhead costs of $1,150,000 and 5,100 labor hours. -The amount of overhead costs applied by the company in March,2014,is:

A job order costing system is used by companies that manufacture large amounts of similar products.

Ad-on International is an advertising company.It estimated the overhead costs for March,2014,to be $950,000 and direct labor hours to be 5,000 hours.In March,it incurred overhead costs of $1,150,000 and 5,100 labor hours. What is the predetermined overhead rate for March,2014?

Which of the following is true of performance evaluation reports?

Lotus Company's actual overhead is greater than the applied overhead.This difference is deemed immaterial.The company records this by debiting Overhead account and crediting Cost of Goods Sold account.Which of the following is true of Lotus Company?

Managers prepare financial statements to communicate the company's performance to its external users.