Part 1-

When packaging and shipping are part of a production process, which of the following accounts will not be affected by the entries to record packing and shipping? Assume that all packaging materials are purchased on account and held in materials inventory prior to use.

Select one:

A. Wages Payable

B. Cost of Goods Sold

C. Manufacturing Overhead

D. Work in Process Inventory

E. Materials Inventory

Part 2-

Which of the following is not a correct reason for using department overhead rates?

Select one:

A. It provides a more equitable allocation of costs than a plant-wide overhead rate.

B. Different departments may have different production capacities.

C. It is more accurate than activity-based costing when jobs are complex and varied.

D. All of these are reasons to use department overhead rates.