Exam Chapters 3,4,7
Student: ___________________________________________________________________________ 1. Which of the following is the correct formula to compute the predetermined overhead rate? A. Estimated total units in the allocation base divided by estimated total manufacturing overhead costs. B. Estimated total manufacturing overhead costs divided by estimated total units in the allocation base. C. Actual total manufacturing overhead costs divided by estimated total units in the allocation base. D. Estimated total manufacturing overhead costs divided by actual total units in the allocation base.
2. Which of the following would probably be the least appropriate allocation base for allocating overhead in a highly automated manufacturer of specialty valves? A. Machine-hours
B. Power consumption
C. Direct labor-hours
D. Machine setups
3. Which terms will make the following statement true? When manufacturing overhead is overapplied, the Manufacturing Overhead account has a __________ balance and applied manufacturing overhead is greater than __________ manufacturing overhead. A. debit, actual
B. credit, actual
C. debit, estimated
D. credit, estimated
4. Daguio Corporation uses direct labor-hours in its predetermined overhead rate. At the beginning of the year, the total estimated manufacturing overhead was $224,580. At the end of the year, actual direct labor-hours for the year were 18,200 hours, manufacturing overhead for the year was underapplied by $12,100, and the actual manufacturing overhead was $219,580. The predetermined overhead rate for the year must have been closest to: A. $11.40 per machine-hour
B. $12.34 per machine-hour
C. $12.06 per machine-hour
D. $10.53 per machine-hour
5. Crinks Corporation uses direct labor-hours in its predetermined overhead rate. At the beginning of the year, the estimated direct labor-hours were 11,200 hours and the total estimated manufacturing overhead was $259,840. At the end of the year, actual direct labor-hours for the year were 10,800 hours and the actual manufacturing overhead for the year was $254,840. Overhead at the end of the year was: A. $4,280 overapplied
B. $9,280 overapplied
C. $9,280 underapplied
D. $4,280 underapplied
6. Washtenaw Corporation uses a job-order costing system. The following data are for last year:
Washtenaw applies overhead using a predetermined rate based on direct labor-hours. What predetermined overhead rate was used last year? A. $3.55 per direct labor-hour
B. $3.25 per direct labor-hour
C. $3.08 per direct labor-hour
D. $3.36 per direct labor-hour
7. A company should use process costing, rather than job order costing, if: A. production is only partially completed during the accounting period. B. the product is manufactured in batches only as orders are received. C. the product is composed of mass-produced homogeneous units. D. the product goes through several steps of production.
8. Which of the following characteristics applies to process costing, but does not apply to job order costing? A. The need for averaging.
B. The use of equivalent units of production.
C. Separate, identifiable jobs.
D. The use of predetermined overhead rates.
9. The cost of beginning inventory under the weighted-average method is: A. added in with current period costs in determining costs per equivalent unit for a given period. B. ignored in determining the costs per equivalent unit for a given period. C. considered separately from costs incurred during the current period. D. subtracted from current period costs in determining costs per equivalent unit for a given period.
10. The Nichols Company uses the weighted-average method in its process costing system. The company recorded 29,500 equivalent units for conversion costs for November in a particular department. There were 6,000 units in the ending work in process inventory on November 30, 75% complete with respect to conversion costs. The...
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