All costs that cannot be traced directly to a product or an activity are ignored for the purpose of costing. True or False True False In a job-order costing system, direct labour costs are usually recorded initially with a debit to: Multiple Choice Manufacturing Overhead. Finished Goods inventory Direct Labour Expense. Work in Process When a product is sold the entry is debit to Multiple Choice cost of goods manufactured finished goods inventory work in process cost of goods sold Indirect materials are not charged to a specific job but rather are included in the Manufacturing Overhead account True or False True False In a job-order costing system, the use of direct materials previously purchased usually is recorded as a debit to: Multiple Choice Work in Process inventory Finished Goods inventory Manufacturing Overhead. Raw Materials inventory Nonmanufacturing costs are expensed as incurred, rather than going into the Work in Process account. True or False True False If a company applies overhead to jobs based on a predetermined overhead rate, a credit balance in the Manufacturing Overhead account at the end of any period means that: Multiple Choice more overhead cost has been charged to jobs than has been incurred during the period. O more overhead cost has been incurred during the period than has been charged to jobs. the amount of overhead cost charged to jobs is greater than the estimated cost for the period the amount of overhead cost charged to jobs is less than the estimated overhead cost for the period Absorption costing includes both fixed and variable costs when computing the cost of a product. True or False True False When the predetermined overhead rate is based on direct labour-hours, the amount of overhead applied to a job is proportional to the amount of actual direct labour-hours incurred on the job. True or False True False In a job-order costing system, the amount of overhead cost that has been applied to a job that remains incomplete at the end of a periodis: Multiple Choice deducted on the Income Statement as overapplied overhead. closed to Cost of Goods Sold O transferred to Finished Goods at the end of the period part of the ending balance of the Work in Process inventory account