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Cost Accounting-Week3-HM 1. The two basic types of cost accounting systems are a. b. c. d. job order and job accumulation systems. job order and process cost systems. process cost and batch systems. job order and batch systems. 2. Which of the following would be accounted for using a job order cost system? a. b. c. d. The production of personal computers. The production of automobiles. The refining of petroleum. The construction of a new campus building. 3.Cost of raw materials is debited to Raw Materials Inventory when the a. b. c. d. materials are ordered. materials are received. materials are put into production. bill for the materials is paid. 4.Which one of the following best describes a job cost sheet? a. It is a form used to record the costs chargeable to a specific job and to determine the total and unit costs of the completed job. b. It is used to track manufacturing overhead costs to specific jobs. c. It is used by management to understand how direct costs affect profitability. d. It is a daily form that management uses for tracking worker productivity on which employee raises are based. 5.In calculating a predetermined overhead rate, a recent trend in automated manufacturing operations is to choose an activity base related to a. b. c. d. direct labor hours. indirect labor dollars. machine hours. raw materials dollars. 6.For Jacobs Company, the predetermined overhead rate is 70% of direct labor cost. During the month, $300,000 of factory labor costs are incurred of which $70,000 is indirect labor. Actual overhead incurred was $160,000. The amount of overhead debited to Work in Process Inventory should be: a. b. c. d. $161,000 $160,000 $210,000 $230,000 1 7.During 2013, Arb Company incurred the following direct labor costs: January $20,000 and February $30,000. Arb uses a predetermined overhead rate of 120% of direct labor cost. Estimated overhead for the 2 months, respectively, totaled $19,500 and $35,700. Actual overhead for the 2 months, respectively, totaled $24,500 and $32,500. Instructions Determine if overhead is over- or underapplied for each of the two months and the respective amounts. 8. At December 31, Ding Company reported the following balances in its accounts: Cost of Goods Sold Finished Goods Inventory $210,000 30,000 The company's balance in its Manufacturing Overhead account at the same date was a debit of $2,400. Instructions Prepare the entry to adjust the over- or underapplied overhead amount at December 31. \\ 2 9.A selected list of accounts used by Cline Manufacturing Company follows: Code A B C D E Cash Accounts Receivable Raw Materials Inventory Work In Process Inventory Finished Goods Inventory Code F G H I J Accounts Payable Factory Labor Manufacturing Overhead Cost of Goods Sold Sales Revenue Cline Manufacturing Company uses a job order system and maintains perpetual inventory records. Instructions Place the appropriate code letter in the columns indicating the appropriate account(s) to be debited and credited for the transactions listed below. Account(s) Account(s) Transactions Debited Credited 1. Raw materials were purchased on account. 2. Issued a check to Dixon Machine Shop for repair work on factory equipment. 3. Direct materials were requisitioned for Job 280. 4. Factory labor was paid as incurred. 5. Recognized direct labor and indirect labor used. 6. The production department requisitioned indirect materials for use in the factory. 7. Overhead was applied to production based on a predetermined overhead rate of $8 per labor hour. 8. Goods that were completed were transferred to finished goods. 9. Goods costing $80,000 were sold for $105,000 on account. 10. Paid for raw materials purchased previously on account. 3