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Exam 15: Job Order Costing and Analysis

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Question 51

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A ___________________________________ is calculated by relating total estimated factory overhead to an allocation factor such as total estimated direct labor cost,and is used to allocate factory overhead to specific jobs.

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predetermined overhe...

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Question 52

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Briefly describe how manufacturing firms dispose of overapplied or underapplied factory overhead.

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If overapplied or underapplied overhead ...

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Question 53

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The Goods in Process Inventory account of a manufacturing company that uses an overhead rate based on direct labor cost has a $4,400 debit balance after all posting is completed.The cost sheet of the one job still in process shows direct material cost of $2,000 and direct labor cost of $800.Therefore,the company's overhead application rate is:

A company allocates overhead to production on the basis of direct labor cost.If the company's total estimated overhead is $870,000 and estimated direct labor cost is $1,160,000,determine the amount of overhead to be allocated to finished goods inventory.There is $791,000 of total direct labor cost in the jobs in the finished goods inventory.

The Goods in Process Inventory account for the AB Corp.follows: $\begin{array}{l}\text { Goods in Process Inventory }\\\begin{array} { l r | r l } \hline \text { Beginning balance } & 4,500 & & \\\text { Direct materials } & 47,100 & & \\\text { Direct labor } & 29,600 & ? & \text { Finished goods } \\\text { Applied overhead } & 15,800 & & \\\text { Ending balance } & 8,900 &\end{array}\end{array}$ The cost of units transferred to finished goods is:

A company that uses a job order cost accounting system incurred $10,000 of factory payroll during May.Present the May 31 entry assuming $8,000 is direct labor and $2,000 is indirect labor.

The amount by which the overhead applied to jobs during a period exceeds the overhead incurred during the period is known as:

A job order cost accounting system would be appropriate for a manufacturer of automobile tires.

A source document that an employee uses to report how much time was spent working on a job or on overhead activities and that is used to determine the amount of direct labor to charge to the job or to determine the amount of indirect labor to charge to factory overhead is called a:

Match the following definitions with the appropriate terms

The job cost sheet for Job number 93-471 includes the following information: DIRECT MATERIALS: 7/12 Requisition R93-566: 20 units @ $ 3.50 per unit 7/13 Requisition R93-576: 18 units @ $ 5.00 per unit 7/13 Requisition R93-578: 4 units @ $25.00 per unit 7/14 Requisition R93-591: 40 units @ $ 1.25 per unit DIRECT LABOR: 7/12 Employee 19: 8 hours @ $ 9.00 per hour 7/13 Employee 19: 6 hours @ $ 9.00 per hour 7/13 Employee 37: 6 hours @ $ 7.00 per hour 7/14 Employee 19: 5 hours @ $ 9.00 per hour 7/14 Employee 92: 5 hours @ $11.00 per hour FACTORY OVERHEAD: Assigned at 150% of direct labor cost. What is the total cost of Job number 93-471?

When factory payroll for indirect labor is assigned,__________________ is debited.

The predetermined overhead allocation rate is used to apply overhead cost to products.

Plumley Ad Agency contracted with a company to prepare an ad campaign.Plumley uses a job order costing system.Plumley estimates that the job will take 145 designer hours at $90 per hour and 85 staff hours at $45 per hour.Plumley uses two overhead rates in applying overhead to jobs: Designer-related at $100 per designer hour and staff-related at $50 per staff hour.Determine the total estimated cost for this job.

If overhead applied is less than actual overhead,it is:

A type of manufacturing that produces customized products or services for each customer is called:

A system of accounting for manufacturing operations that produces timely information about inventories and manufacturing costs per unit of product is a:

Explain what a predetermined overhead allocation rate is,how it is calculated,and why it is used.

The overhead cost applied to a job during a period is recorded with a credit to Factory Overhead and a debit to:

The predetermined overhead allocation rate based on direct labor cost is the ratio of estimated overhead cost for the period to estimated direct labor cost for the period.