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Exam 2: Job-Order Costing

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Question 61

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Frontier Inc. has provided the following information for 20x5: a. Purchased raw materials on account for $240,000. b. Issued $230,000 in raw materials to production ($32,000 were not traceable to specific jobs). c. Incurred $242,000 in direct labor costs (24,120 hours) and $92,500 in supervision costs (paid in cash). d. Incurred the following additional manufacturing overhead costs: factory utilities $24,000 (paid in cash); depreciation on equipment $45,000; indirect supplies $17,500 (paid in cash). e. Incurred the following nonmanufacturing costs, both paid in cash: advertising $75,000; sales salaries $88,000. f. Applied manufacturing overhead to jobs in process at a rate of $9 per direct labor hour. g. Completed jobs costing a total of $644,000. h. Sold jobs for $856,000 on account. The cost of the jobs was $642,000. i. Closed the manufacturing overhead account balance. Prepare the journal entries to record these transactions.

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Question 62

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Which of the following accounts is not affected by applied manufacturing overhead?

A) Raw Materials Inventory
B) Work in Process Inventory
C) Finished Goods Inventory
D) Cost of Goods Sold

E) None of the above
F) B) and D)

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Question 63

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Manufacturing overhead was estimated to be $400,000 for the year along with 20,000 direct labor hours. Actual manufacturing overhead was $415,000, actual labor hours were 21,000. The amount of manufacturing overhead applied to production would be:

Which of the following would be used to transfer the cost of completed goods during the period to the Finished Goods account?

The total manufacturing cost for a job is based on the amount of applied overhead using the predetermined overhead rate

Jenkins Company had the following information for the year: Jenkins Company used a predetermined overhead rate using estimated overhead of $320,000 and 8000 estimated direct labor hours. Assume the only inventory balance is an ending Finished Goods Inventory balance of $19,000. What was adjusted cost of goods sold?

Which of the following represents the cost of the jobs sold during the period?

The total amount of cost assigned to jobs that were completed during the year is the cost of goods sold

Manufacturing overhead was estimated to be $400,000 for the year along with 20,000 direct labor hours. Actual manufacturing overhead was $415,000, and actual labor hours were 21,000. To dispose of the balance in the Manufacturing Overhead account, which of the following would be correct?

Optimum Finance Inc. provides budget, savings, and investment services to clients who want a stress-free financial lifestyle. The company customizes a program for each client based on their individual goals that includes budget recommendations, investment counseling, and savings techniques. The company uses a job order cost system that keeps track of the cost of the amount of time financial consultants spend with each client. Optimum applies all indirect operating costs (e.g., rent, utilities, and management salaries) as a percentage of the consultant's labor cost. During the most recent year, the firm estimated that it would pay $500,000 to its consultants and incur indirect operating costs of $750,000. Actual consultant labor costs were $537,500 and actual indirect operating costs were $725,000. What is the predetermined overhead rate that Optimum will use for the current year?

Barone Inc. uses a job order costing system with manufacturing overhead applied to products at a rate of 100% of direct labor cost. Treating each case independently, find the missing amounts for a through l:

Deer Lake Inc. uses a job order costing system with manufacturing overhead applied to products at a rate of 150% of direct labor cost. Treating each case independently, find the missing amounts for a through l:

Source documents are used to assign all manufacturing costs to jobs

Manufacturing overhead was estimated to be $200,000 for the year along with 20,000 direct labor hours. Actual manufacturing overhead was $215,000, and actual labor hours were 21,000. The predetermined overhead rate per direct labor hour would be:

Manufacturing overhead is applied to each job using which formula?

A marketing consulting firm would most likely use process costing

Mendez Inc. had the following information for the preceding year: Additional information for the year is as follows: What was the beginning Finished Goods Inventory balance on 1/1?

Which of the following represents the cost of materials purchased but not yet issued to production?

Manufacturing overhead was estimated to be $400,000 for the year along with 20,000 direct labor hours. Actual manufacturing overhead was $415,000, and actual labor hours were 21,000. The amount credited to the Manufacturing Overhead account would be:

Manufacturing overhead was estimated to be $200,000 for the year along with 20,000 direct labor hours. Actual manufacturing overhead was $215,000, and actual labor hours were 21,000. Which of the following would be correct?