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Exam 2: Job-Order Costing

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Question 51

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Ragtime Company had the following information for the year: Ragtime Company used a predetermined overhead rate of $35 per direct labor hour for the year. Assume the only inventory balance is an ending Work in Process Inventory balance of $17,000. What was adjusted cost of goods sold?

A) $435,000
B) $426,000
C) $418,000
D) $409,000

E) None of the above
F) All of the above

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Question 52

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Russo Cabinets is a custom cabinet builder. They recently completed a set of kitchen cabinets (Job #1887), as summarized below: Russo applies overhead to jobs at a rate of $18 per direct labor hour. a. How much overhead would be applied to Job #1887? b. What is the total cost of Job #1887?

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Question 53

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If a company uses a predetermined overhead rate, which of the following statements is correct?

Which of the following is a characteristic of a manufacturing environment that would use job order costing?

A predetermined overhead rate is calculated by dividing estimated total manufacturing overhead cost by estimated total cost driver

When units are completed, the cost associated with the job is credited to which account?

Overhead was estimated to be $250,000 for the year along with 20,000 direct labor hours. Actual overhead was $225,000, and actual direct labor hours were 19,000. The amount debited to the manufacturing overhead account would be:

The most common method for disposing of over or underapplied overhead is to:

Belton Custom Kitchens is a custom cabinet builder. They recently completed a set of kitchen cabinets (Job #3097), as summarized below: Belton applies overhead to jobs at a rate of $17 per direct labor hour. a. How much overhead would be applied to Job #3097? b. What is the total cost of Job #3097?

Which of the following represents the cost of jobs completed but not yet sold?

Highview Corp. applies manufacturing overhead to production at 125% of direct labor cost. During 20x5, manufacturing overhead of $100,000 was applied to production; actual manufacturing overhead was $109,000. Beginning Work in Process Inventory was $15,000 and beginning Finished Goods Inventory was $35,000. Work in Process Inventory increased by 10% during the year and Finished Goods Inventory decreased by 20% during the year. Sales for 20x5 were $450,000, yielding a $130,000 gross profit. Complete the following schedule:

Oscar Corp. applies manufacturing overhead to production at 150% of direct labor cost. During 20x5, manufacturing overhead of $180,000 was applied to production; actual manufacturing overhead was $199,000. Beginning Work in Process Inventory was $20,000 and ending Work in Process Inventory was $24,000. Beginning Finished Goods Inventory was $42,000, ending Finished Goods Inventory was $39,000. Sales for 20x5 were $580,000, yielding a $117,000 gross profit. Complete the following schedule:

Geller Cabinets is a custom cabinet builder. They recently completed a set of kitchen cabinets (Job #12478), as summarized below: Geller applies overhead to jobs at a rate of $15 per direct labor hour. a. How much overhead would be applied to Job #12478? b. What is the total cost of Job #12478?

When manufacturing overhead is applied to production, which of the following accounts is credited?

Cost of goods completed is the same as:

Process costing averages the total cost of the process over the number of units produced

Cost of goods manufactured is the amount of cost transferred:

Pinnacle Consulting employs two CPAs, each having a different area of specialization. Judy specializes in tax consulting and Steve specializes in management consulting. Pinnacle expects to incur total overhead costs of $519,750 during the year and applies overhead based on annual salary costs. Judy is a senior partner, her annual salary is $225,000, and she is expected to bill 2,000 hours during the year. Steve is a senior associate, his annual salary is $121,500, and he is expected to bill 1,800 hours during the year. a. Calculate the predetermined overhead rate. b. Assuming that the hourly billing rate should be set to cover the total cost of services plus a 20% markup, compute the hourly billing rates for Judy and Steve.

Kilt Company had the following information for the year: Kilt Company used a predetermined overhead rate of $42.00 per direct labor hour for the year and estimated that direct labor hours would total 5,500 hours. Assume the only inventory balance is an ending Work in Process balance of $17,000. How much overhead was applied during the year?

McGown Corp. has the following information: Additional information for the year is as follows: Compute the direct materials used in production.