11. Terra Mesa Manufacturing uses a job order cost system to account for its production of specialty patio furniture. At the beginning of June, Terra Mesa had one job in Work in Process, job A75. Management has chosen direct labor cost as its activity base. The costs incurred to date on job A75 are as follows: Direct materials $8,260 Direct labor 10,500 Overhead 13,125 During June, Terra Mesa added the following costs for direct materials and direct labor to job A75: Direct materials $2,630 Direct labor 4,620 Job A75 was competed on June 30. What is the cost of job A75? a. $39,135 b. $44,910 C. $42,831 d. $26,010 12. Mirada Manufacturing produces pumps for residential swimming pools. For the year, management estimated that total manufacturing overhead would be $1,488,000. Management decided to use direct labor hours to apply manufacturing overhead and budgeted 62,000 direct labor hours. The balance in over- or underapplied overhead is deemed to be small. The following information was compiled before an adjustment had been made to close Manufacturing Overhead Control: Raw Materials Inventory Work in Process Inventory Finished Goods Inventory Actual direct labor hours used Actual overhead incurred $304,291 $337,997 $756,362 68,970 $1,434,576 For the year, manufacturing overhead was a. $220,704 underapplied b. $220,704 overapplied C. $144,976 overapplied d. $144,976 underapplied 13. If the amount of overapplied manufacturing overhead is small most companies will generally make which of the following adjusting entries? a. Manufacturing Overhead Control Cost of Goods Sold b. Manufacturing Overhead Control Finished Goods Inventory C. Cost of Goods Sold Manufacturing Overhead Control d. Finished Goods Inventory Manufacturing Overhead Control Cost of goods manufactured is a. always the same amount as the total direct costs. b. recorded as a debit to the Cash or Accounts Receivable account. c. recorded as a debit to the Finished Goods Inventory account. d. also referred to as the Cost of Goods Sold. 15. Basil Industries reported the following information for December: Beginning balance, Raw Materials Inventory $ 187,500 Beginning balance, Work in Process Inventory 300,000 Beginning balance, Finished Goods Inventory 106,250 Manufacturing overhead applied 525,000 Purchases of raw materials 337,500 Factory electricity 62,500 Direct labor payroll 200,000 Depreciation on factory equipment 218,750 Insurance on factory building 50,000 Indirect materials used in production 43,750 Total raw materials used in production 406,250 Indirect labor payroll 150,000 Cost of goods manufactured 1,250,000 Cost of Goods Sold 1,312,500 What was the ending balance in Basil's Raw Materials Inventory account at December 31? a. $75,000 b. $118,750 C. $162,500 d. $206,250 16. At the beginning of the year, managers at King Industries estimated $400,000 in manufacturing overhead, 20,000 direct labor hours and 50,000 machine hours. Actual manufacturing costs at the end of the year were $425,000 in manufacturing overhead. During the year 22,000 direct labor hours and 47,000 machine hours were incurred. If overhead is applied based on direct labor hours, how much overhead was applied during the year? a. $399,960 b. $440,000 C. $467,500 d. $425,040 17. The managers of Red Heart Draperies are planning for the upcoming year. In years past, the company has applied overhead based on direct labor costs. However, management believes that direct labor hours are a better basis for applying overhead and plans to use direct labor hours to apply overhead for the upcoming year. Estimated overhead for upcoming year $978,850 Estimated direct labor hours for upcoming year 44,860 Estimated direct labor cost for upcoming year $834,396 What is the predetermined overhead rate for the upcoming year (round all answers to the nearest cent)? a. $18.60 per DLH b. $21.82 per DLH c. $1.17 per DLH d. $0.85 per DLH 18. If a company chooses to spread overapplied or underapplied overhead to all the accounts that contain applied overhead, the proration should be based on a. the number of accounts. b. the relative size of the ending balance in each account. c. the account that has had the least overhead applied to it during the month. d. the amount of overhead applied to each account during the period. 19. Dawn Manufacturing produces industrial light fixtures. For the year, management estimated that total manufacturing overhead would be $1,120,000. Management decided to use direct labor hours to apply manufacturing overhead and budgeted 144,600 direct labor hours. The following information was compiled before an adjustment had been made to close Manufacturing Overhead Control: Raw Materials Inventory Work in Process Inventory Finished Goods Inventory Cost of Goods Sold $ 124,600 464,220 432,870 2,340,900 For the year, manufacturing overhead was underapplied by $220,000. If Dawn prorates the underapplied overhead, what is the ending balance of the Finished Goods Inventory? Use 4 decimals for the rate. a. $403,456 b. $462,284 C. $461,184 d. $404,556 0. Which of the following is the correct journal entry to record the purchase of indirect materials on account? a. Raw Materials Inventory Accounts Payable b. Manufacturing Overhead Accounts Payable C. Work in Process Inventory Accounts Payable d. Merchandise Inventory Accounts Payable