10. Which of the following companies would be most likely to use a job-order costing system rather than a process costing system? A. fast food restaurant B. shipbuilding C. seedlings for sale in a nursery D. candy making

11. In job-order costing, all of the following statements are correct with respect to labor time and cost EXCEPT: A. Time tickets are kept by employees showing the amount of work on specific jobs. B. The job cost sheet for a job will contain all direct labor charges to that particular job. C. Labor cost that can be traced to a job only with a great deal of effort is treated as part of manufacturing overhead. D. A machine operator performing routine annual maintenance work on a piece of equipment would charge the maintenance time to a specific job.

12. When using a job-order costing system, manufacturing overhead is allocated using the ____________________ manufacturing overhead rate and the ____________________ quantity of the allocation base. A. actual, actual B. actual, estimated C. estimated, actual D. estimated, estimated

13. What effect will the UNDERAPPLIED overhead have on net operating income? A. Net operating income will increase B. Net operating income will decrease C. Net operating income will be unaffected D. Not enough information to come up with a conclusion

14. OVERAPPLIED Manufacturing Overhead would require which of the following year-end adjustments? A. A deduction to the Finished goods inventory B. A deduction to Manufacturing overhead C. An addition to Work-in-process inventory D. A deduction to Cost of goods sold

15. Underapplied overhead occurs when A. not enough overhead was assigned to the jobs during the period, therefore the Cost of Goods Sold was OVERSTATED. B. overhead assigned to the jobs during the period was in EXCESS, therefore the Cost of Goods Sold was UNDERSTATED C. actual overhead cost is LESS THAN the amount of overhead cost applied to Work in Process inventory during the period D. actual overhead cost EXCEEDS the amount of overhead cost applied to Work in Process inventory during the period

16. A company uses direct labor cost as a basis for computing its predetermined overhead rate. In computing the predetermined overhead rate for last year, the company misclassified a portion of direct labor cost as indirect labor. The effect of this misclassification will be to A. understate the predetermined overhead rate. B. overstate the predetermined overhead rate. C. cannot be determined from the information given. D. have no effect on the predetermined overhead rate.

17. A job order cost system uses a predetermined overhead rate based on estimated activity and estimated manufacturing overhead cost. At the end of the year, underapplied overhead might be explained by which of the following situations? Actual activity Actual manufacturing overhead costs A. Greater than estimated Greater than estimated B. Greater than estimated Less than estimated C. Less than estimated Greater than estimated D. Less than estimated Less than estimated

18. Indirect manufacturing costs A. are all manufacturing costs related to the cost object, and can be traced in an economically feasible way. B. are all manufacturing costs related to the cost object, but cannot be traced in an economically feasible way. C. examples include supplies, factory rent, indirect materials, salaries of factory supervisor, and wages of machine operators and assembly-line workers. D. include the compensation of all manufacturing labor that can be traced to the cost object in an economically feasible way.

19. Product costs appear on the balance sheet A. only if goods are partially completed at the end of the period. B. only if goods are unsold at the end of a period. C. only if goods are partially completed or are unsold at the end of a period. D. only in merchandising firms.

20. The following are included in the computation of goods manufactured except A. raw materials. B. direct labor. C. work-in-process. D. actual overhead.