Question 1

Which of the following business is least likely to use job order costing?

1	Automobile manufacturer
2	House paint manufacturer
3	Automotive repair shop
4	Oil refiner

Question 2 How is the overhead application rate computed?

1	Estimated Overhead Costs/Estimated Units in the Activity Base
2	Actual Overhead Costs/Estimated Units in the Activity Base
3	Actual Overhead Costs/Actual Units in the Activity Base
4	Estimated Overhead Costs/Actual Units in the Activity Base

Question 3 What is the major criterion for an activity base to be a cost driver?

1	It must be material in amount
2	It must be totally consumed within the accounting period.
3	It must have a definitive causal factor in the incurrence of overhead costs
4	It must be related to direct labor or direct labor hours

Question 4 When is the overhead application rate determined?

1	After actual overhead costs are recorded.
2	After paid and incurred overhead costs are recorded.
3	At the beginning of the period before actual overhead costs are determined.
4	On a day-to-day basis.

Question 5 The typical job cost sheet used in a job order costing system is used to accumulate which of the following for each particular job?

1	Direct labor
2	Direct materials
3	Manufacturing overhead applied
4	All of the above

Question 6 Issuing a materials requisition results in which of the following journal entries?

1	A debit to Work in Process Inventory and a credit to Materials Inventory.
2	A debit to Materials Inventory and a credit to Work in Process Inventory.
3	A debit to Materials Inventory and a credit to Accounts Payable.
4	A debit to Manufacturing Overhead and a credit to Materials Inventory.

Question 7 Which of the following accounts is not a control account in a job order costing system?

1	Finished Goods Inventory
2	Materials Inventory
3	Work in Process Inventory
4	Direct Labor

Question 8 Which of the following is true about Activity-Based Costing (ABC)?

1	It is used primarily where a single product is manufactured.
2	It uses many activity bases or cost drivers.
3	It is an overhead allocation method that uses a single overhead rate.
4	It is of little use in pricing products.

Question 9 Stage One of an activity-based costing (ABC) system involves which of the following?

1	Computing the overhead application rate.
2	Allocating cost pools to products.
3	Identifying activity cost pools.
4	Determining unit costs.

Question 10 Stage Two of an activity-based costing (ABC) system involves which of the following?

1	Identifying cost drivers.
2	Allocating cost pools to products.
3	Determining per-unit costs
4	All of the above