Exercise 5

When Job 711 was completed, direct materials totaled $3,000; direct labor, $3,500; and factory overhead, $1,500, respectively. Units produced totaled 1,000. Unit costs are:

Select one:

a. $8,000

b. $800

c. $80

d. $8

Exercise 6

Compute conversion costs given the following data: Direct Materials, $247,800; Direct Labor, $183,400; Factory Overhead, $121,300.

Select one:

a. $431,200

b. $552,500

c. $304,700

d. $369,100

Exercise 7

Albany, Inc. has estimated total factory overhead costs of $400,000 and 20,000 direct labor hours for the current fiscal year. If direct labor hours for Job N41 total 1,000, calculate applied factory overhead applied to this job.

Select one:

a. $40,000

b. $20,000

c. $2,000

d. cannot be determined

Exercise 8

Compute factory overhead cost from the following costs:

Depreciation on factory buildings	$ 15,000
Depreciation on office equipment	20,000
Direct materials used	70,000
Indirect labor	3,000

Select one:

a. $3,000

b. $35,000

c. $18,000

d. $108,000

Exercise 9

The following information is available for the first month of operations for Atlantis, Inc.:

Sales	$570,000
Gross Profit	200,000
Indirect Labor	20,000
Indirect Materials	9,000
Other factory overhead	7,500
Materials purchased	250,000
Total manufacturing costs	420,000
Materials inventory, end of period	10,000

a. Calculate cost of goods sold:

Select one:

a. $420,000

b. $370,000

c. $286,500

d. $277,500

b. Calculate direct materials cost used in production:

Select one:

a. $231,000

b. $240,000

c. $250,000

d. $259,000

Exercise 10

In a job order cost accounting system the effect of receiving materials and the invoice is to

Select one:

a. increase Work in Process, decrease Materials Inventory

b. increase Materials Inventory, increase Accounts Payable

c. increase Materials Inventory, decrease Accounts Payable

d. decrease Work in Process, decrease Materials Inventory

Exercise 11

Which of the following would probably NOT be found in the accounting system of a service provider?

Select one:

a. Cost ledger

b. Finished goods ledger

c. Cost of services account

d. Job cost sheets

Exercise 12

A DISADVANTAGE of maintaining high inventory levels includes:

Select one:

a. providing a buffer to protect against process problems

b. hiding underlying production problems such as unexpected scrap and rework

c. maintaining inventory is wasteful and unnecessary

d. both (b) and (c) are disadvantages of maintaining inventory

Exercise 13

The amount of time spent by an employee in the factory is usually recorded on:

Select one:

a. time tickets

b. job order cost sheets

c. employees' earnings records

d. clock cards