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| 1 | |
Peters Plumbing Company uses a job order costing system. At the beginning of August, the company had two jobs in process with the following costs:
| Direct Material | Direct Labour | Manufacturing Overhead | Job 456 | $3400 | $510 | $204 | Job 461 | 1100 | 290 | ? |
Peters Plumbing pays its workers $10 per hour and applies overhead on a direct labour hour basis. The predetermined manufacturing overhead rate per direct labour hour is: |
| | A) | $0.075 |
| | B) | $0.50 |
| | C) | $4 |
| | D) | $4.25 |
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| 2 | |
Peters Plumbing Company uses a job order costing system. At the beginning of August, the company had two jobs in process with the following costs:
| Direct Material | Direct Labour | Manufacturing Overhead | Job 456 | $3400 | $510 | $204 | Job 461 | 1100 | 290 | ? |
Peters Plumbing pays its workers $10 per hour and applies overhead on a direct labour hour basis. The manufacturing overhead included in the cost of Job 461 at the beginning of August was: |
| | A) | $144.50 |
| | B) | $153.00 |
| | C) | $2200.00 |
| | D) | $116.00 |
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| 3 | |
Peters Plumbing Company uses a job order costing system. At the beginning of August, the company had two jobs in process with the following costs:
| Direct Material | Direct Labour | Manufacturing Overhead | Job 456 | $3400 | $510 | $204 | Job 461 | 1100 | 290 | ? |
Peters Plumbing pays its workers $10 per hour and applies overhead on a direct labour hour basis. During August, Peters Plumbing employees worked on Job 476. At the end of the month, $500 of manufacturing overhead had been applied to this job. Total work in process inventory at the end of the month was $12 451 and all other jobs had a total cost of $6133. The amount of direct material included in Job 476 is: |
| | A) | $1391 |
| | B) | $2142 |
| | C) | $3267 |
| | D) | $4568 |
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| 4 | |
Doncaster Company uses a predetermined manufacturing overhead application rate of $0.50 per direct labour hour. During the year, Doncaster incurred $575 000 of actual manufacturing overhead, but it planned to incur $625 000 of manufacturing overhead. The company applied $605 000 of manufacturing during the year. How many direct labour hours did the company plan to incur? |
| | A) | 1 190 000. |
| | B) | 1 200 000. |
| | C) | 1 210 000. |
| | D) | 1 250 000. |
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| 5 | |
If manufacturing overhead is overapplied, this indicates: |
| | A) | actual manufacturing overhead costs are higher than manufacturing overhead applied to production |
| | B) | actual manufacturing overhead costs are higher than budgeted manufacturing overhead |
| | C) | actual manufacturing overhead costs are lower than budgeted manufacturing overhead |
| | D) | actual manufacturing overhead costs are lower than manufacturing overhead applied to production |
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| 6 | |
The Components Manufacturing Company uses a predetermined manufacturing overhead application rate of
$4 per direct labour hour. During the year, 40 000 direct labour hours were worked. Actual manufacturing
overhead costs for the year were $150 000. The Components Manufacturing Company’s manufacturing
overhead was: |
| | A) | $5000 underapplied |
| | B) | $5000 overapplied |
| | C) | $10 000 underapplied |
| | D) | $10 000 overapplied |
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| 7 | |
The schedule of cost of goods manufactured details the movements through: |
| | A) | raw materials inventory |
| | B) | work in process inventory |
| | C) | finished goods inventory |
| | D) | raw materials inventory and work in process inventory |
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| 8 | |
The schedule of cost of goods sold details the movements through: |
| | A) | raw materials inventory |
| | B) | work in process inventory |
| | C) | finished goods inventory |
| | D) | raw materials inventory and work in process inventory |
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| 9 | |
The Heidelberg Manufacturing Company has zero balances in its work in process and finished goods inventory accounts on December 31 of the previous year. The balances in Heidelberg’s accounts as of December 31 of the current year are as follows: Cost of goods sold | $5 000 000 | Selling and Administrative expenses | 450 000 | Sales Revenue | 10 000 000 | Actual manufacturing overhead | 850 000 | Applied manufacturing overhead | 900 000 |
If Heidelberg Manufacturing Company writes off over or underapplied manufacturing overhead to the cost of goods sold, the net profit before taxes for the current year is: |
| | A) | $5 000 000 |
| | B) | $3 700 000 |
| | C) | $4 600 000 |
| | D) | $4 500 000 |
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| 10 | |
Process costing is used by companies that: |
| | A) | produce a single product (or a small range of very similar products) in large quantities |
| | B) | produce a single product (or a small range of very similar products) in small quantities |
| | C) | produce products in distinct batches and there are significant differences between the batches |
| | D) | produce products individually and they are of a unique nature |
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