• distinguish between process costing and job-order costing and identify the products that fit with each costing method;
• identify the documents used in a job-order costing system and record the journal entries that reflect the flow of costs in such a system;
• compute predetermined overhead rates and explain why estimated overhead costs (rather than actual overhead costs) are used in the costing process;
• apply overhead cost to work in process using a predetermined overhead rate;
• prepare schedules of cost of goods manufactured and cost of goods sold;
• compute underapplied or overapplied overhead cost and prepare the journal entry to close the balance in manufacturing overhead to the appropriate accounts;
• record the flow of materials, labor, and overhead through a process costing system; and
• compute the equivalent units of production, the cost per equivalent unit, and assign costs to units using the weighted-average method.