1. The journal entry to record when a job is completed would include a:

a. debit to Cost of Goods Sold b. credit to Finished Goods Inventory

c. debit to Finished Goods Inventory. d. debit to Work in Process Inventory

2. Baines Company has the following estimated costs for next year:

Direct materials $ 25,000

Salary of production supervisor 65,000

Indirect materials 2,000

Rent on factory equipment 14,000

Depreciation on Office Equipment 12,000

Sales commissions 15,000

Supplies for the factory lunchroom 1,000

Customer shipping 6,000

Wages of factory security personnel 20,000

Direct labor 40,000

Advertising expense 10,000

Baines estimates that 10,000 machine hours will be worked during the year. The overhead rate per machine

hour will be (Hint: Choose which of the above costs are Overhead costs, add them together, and divide the total by 10,000):

a. $8.10. c. $11.40.

b. $10.20. d. $8.20

3. The following entry would be made to apply $12,000 of overhead costs to products:

WIP 12,000

Overhead 12,000

a. true

b. false

4. A debit balance in the Manufacturing Overhead account at the end of the year means that overhead was underapplied.

a. true

b. false

5. A company that uses process costing will maintain a separate Work in Process Inventory account for each job under construction.

a. true

b. false