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Principles of Accounting, Volume 2: Managerial Accounting

Questions

Principles of Accounting, Volume 2: Managerial AccountingQuestions

Questions

1.

LO 4.1A printing company manufactures notebooks of various sizes. The company manufactures 3,000 notebooks each day. Should the company use process costing or job order costing?

2.

LO 4.1Burnham Industries incurs these costs for the month:

What is the prime cost?

3.

LO 4.1Choco’s Chocolates incurs these costs for the month:

What is the conversion cost?

4.

LO 4.1How do job order costing and process costing differ with respect to recording direct materials and direct labor?

5.

LO 4.1Why are product costs assigned to the product and period costs immediately expensed?

6.

LO 4.3Is the cost of goods manufactured the same as the cost of goods sold?

7.

LO 4.3From beginning to end, place these items in the order of the flow of goods.

  1. cost of goods sold
  2. raw materials inventory
  3. finished goods inventory
  4. work in process inventory
8.

LO 4.4How is the predetermined overhead rate determined?

9.

LO 4.4How is the predetermined overhead rate applied?

10.

LO 4.5Why are the overhead costs first accumulated in the manufacturing overhead account instead of in the work in process inventory account?

11.

LO 4.6Why is the manufacturing overhead account debited as expenses are recognized and then credited when overhead is applied?

12.

LO 4.7Match the concept on the left to its correct description.

13.

LO 4.8When compared to manufacturing companies, service industries do not generally use ________ as a component of product cost.

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