Test Bank for Introduction to Managerial Accounting 6th Edition Brewer, Garrison, Noreen/rated A

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Chapter 02 Job-Order Costing True / False Questions 1. The use of predetermined overhead rates in a job-order cost system makes it possible to estimate the total cost of a given job as soon as... production is completed. 2. A job cost sheet is used to accumulate costs charged to a job. 3. The following journal entry would be made to apply overhead cost to jobs in a job-order costing system: 4. Under a job-order cost system the Work in Process account is debited with the cost of materials purchased. 5. The process of assigning overhead cost to jobs is known as overhead application. 6. The cost of a completed job in a job-order costing system typically consists of the actual direct materials cost of the job, the actual direct labor cost of the job, and the actual manufacturing overhead cost of the job. 7. A debit balance in the Manufacturing Overhead account at the end of the year means that manufacturing overhead is overapplied. 8. Period costs are expensed as incurred, rather than going into the Work in Process account. 9. Advertising costs should be charged to the Manufacturing Overhead account. 10 When a job has been completed, the goods are transferred from the . production department to the finished goods warehouse and the journal entry would include a credit to Work in Process. 11 Underapplied or overapplied manufacturing overhead represents the . difference between actual overhead costs and applied overhead costs. 12 Top management salaries should not go into the Manufacturing Overhead . account. 13 If manufacturing overhead applied exceeds the actual manufacturing . overhead costs of the period, then manufacturing overhead is overapplied. Multiple Choice Questions 14 In computing its predetermined overhead rate, Marple Company . inadvertently left its indirect labor costs out of the computation. This oversight will cause: 15 Which of the following is the correct formula to compute the . predetermined overhead rate? [Show More]

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