Exam 2: Pre-Test Questions

BUS 548 SU 2012 Pre-Test #2- Key 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.
TRUE

AACSB: Reflective Thinking
AICPA BB: Critical Thinking
AICPA FN: Measurement
Blooms: Knowledge
Garrison - Chapter 03 #1
Learning Objective: 03-01 Compute a predetermined overhead rate
Level: Easy 2. The process of assigning overhead cost to jobs is known as overhead application.
TRUE

AACSB: Reflective Thinking
AICPA BB: Critical Thinking
AICPA FN: Measurement
Blooms: Knowledge
Garrison - Chapter 03 #5
Learning Objective: 03-02 Apply overhead cost to jobs using a predetermined overhead rate
Level: Easy 3. The cost of a completed
A process costing system would be best suited for production of a large quantity of a homogeneous product.
TRUE

AACSB: Reflective Thinking
AICPA BB: Industry
AICPA FN: Measurement
Blooms: Knowledge
Garrison - Chapter 04 #4
Learning Objective: 04-01 Record the flow of materials; labor; and overhead through a process costing system
Level: Easy 8. When computing the cost per equivalent unit, it is not necessary to consider the percentage completion of the units in beginning inventory under the weighted-average method.
TRUE

AACSB: Reflective Thinking
AICPA BB: Critical Thinking
AICPA FN: Measurement
Blooms: Comprehension
Garrison - Chapter 04 #11
Learning Objective: 04-03 Compute the cost per equivalent unit using the weighted-average method
Level: Medium 9. The weighted-average method of process costing can only be used if materials are added at the beginning of the production process.
FALSE

AACSB: Reflective Thinking
AICPA BB: Critical Thinking
AICPA FN: Measurement
Blooms:
$3.25 per direct labor-hour
C. $3.08 per direct labor-hour
D. $3.36 per direct labor-hour
Predetermined overhead rate = Estimated total manufacturing overhead Estimated total amount of the allocation base
= $39,000 12,000 direct labor-hours
= $3.25 per direct labor-hour

AACSB: Analytic
AICPA BB: Critical Thinking
AICPA FN: Measurement
Blooms: Application
Garrison - Chapter 03 #37
Learning Objective: 03-01 Compute a predetermined overhead rate
Level: Medium 33. The following data have been recorded for recently completed Job 674 on its job cost sheet. Direct materials cost was $2,039. A total of 32 direct labor-hours and 175 machine-hours were worked on the job. The direct labor wage rate is $14 per labor-hour. The company applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $15 per machine-hour. The total cost for the job on its job cost sheet would be:
A. $2,967
B. $2,487
C. $2,068
D. $5,112

AACSB: Analytic
AICPA BB: Critical Thinking
AICPA FN: Measurement
Blooms: Application
Garrison - Chapter 03 #45
Learning Objective: 03-02 Apply overhead cost to jobs using a predetermined overhead rate
Learning Objective: 03-03 Compute the total cost and average cost per unit of a job
Level: