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Exam 17: Costing Systems- Job Order Costing

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Question 41

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In a job order costing system,indirect labor costs incurred are charged to the Work in Process Inventory account.

A) True
B) False

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Question 42

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Unique products are produced in a continuous flow production process.

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B) False

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Question 43

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The basic document for keeping track of costs in a job order costing system is a

Quicker Company uses a job order costing system.On May 1,Quicker Company's Work in Process Inventory account shows a beginning balance of $161,000.Production activity for May was as follows: Materials costing $91,000,along with operating supplies of $18,000,were requisitioned into production.Quicker Company's total payroll was $316,000,of which $77,000 was indirect labor.Overhead is applied at a rate of 120 percent of direct labor cost.Quicker's Cost of Goods Sold for the month of May was $692,000.Finished Goods Inventory was $71,500 on May 1 and $84,000 on May 31.(Quicker does not close out overhead accounts until year-end.) a. Calculate Quicker's cost of goods completed for May. b. Calculate Quicker's work in process ending inventory (May 31). c. One of the jobs that was started in May, Job 266, was completed in June. Job 266 was 200 special-order lamps. The following costs had been applied to Job 266 as of June 1: direct materials, $1,400; direct labor, $1,800; overhead, $2,160. In June, $580 in direct materials cost and $900 of direct labor cost were added to complete Job 266. What was the cost per unit for Job 266? (Show your computations.)

The typical product costing system in a factory incorporates parts of both job order costing and process costing to create a hybrid system.

Bear Country produces hand-carved wooden bears and uses a job order costing system.The following are data on the three jobs worked on in the company's first month of operations: $\begin{array}{lrrr}&\text { Smokey } & \text { Rocky } & \text { Curious }\\ \text { Number of bears } & 180 & 100 & 80 \\\text { Direct labor hours worked } & 400 & 200 & 140 \\\text { Direct materials cost } & \$ 4,500 & \$ 2,700 & \$ 2,000 \\\text { Direct labor cost } & \$ 6,000 & \$ 3,000 & \$ 2,100\end{array}$ Overhead cost is applied to job orders on the basis of direct labor hours at a predetermined rate of $10 per hour.The Smokey and Rocky bears were completed during the month,and the Curious bears remained in work in process at the end of the month. a. Compute the cost transferred to finished goods during the month. b. Compute the unit cost for a Rocky bear.

In cost-plus contracts,the "plus" represents

Which of the following is not a characteristic of a job order costing system?

Costs assigned to the building of a house should appear on the income statement when

After a job is completed,the product unit cost can be determined from the job order cost card.

If applied overhead exceeds actual overhead,cost of goods sold must be reduced by the amount of the overcharge in a job order costing system.

The balance in the Work in Process Inventory account on April 1 was $26,800,and the balance on April 30 was $22,600.Costs incurred during the month were as follows: direct materials,$41,250; direct labor,$21,300; and overhead,$32,600.What amount was transferred to the Finished Goods Inventory account for April?

When a job is completed in a service organization,the job costs are transferred to the

In a job order costing system,at the end of the accounting period,the balance in the subsidiary ledger for unfinished jobs should equal the ending balance in the Work in Process Inventory account.

The _________ provide(s) the most direct means of calculating unit costs for a job.

The production process determines the product costing system needed.

Which of the following products probably would be manufactured using a job order costing system?