ACG 203 Final Exam Multiple Choice with all Correct &
100% Verified Answers |Actual Complete Exam |Already
Graded A+
Which of the following would most likely NOT be included as manufacturing overhead in a
furniture factory?
a.) The cost of the glue in a chair.
b.) The amount paid to the individual who stains a chair.
c.) The workman's compensation insurance of the supervisor who oversees production.
d.) The factory utilities of the department in which production takes place. ✔Correct Answer-
The amount paid to the individual who stains a chair
Manufacturing overhead includes:
a.) all direct material, direct labor and administrative costs.
b.) all manufacturing costs expect direct labor.
c.) all manufacturing costs except direct labor and direct materials.
d.) all selling and administrative costs. ✔Correct Answer-all manufacturing costs except direct
labor and direct materials
The cost of electricity for running production equipment is classified as:
Conversion cost Period cost
a.) Yes No
b.) Yes Yes
c.) No Yes
d.) No No ✔Correct Answer-Choice A
A cost incurred in the past that is not relevant to any current decision is classified as a(n):
a.) period cost
b.) opportunity cost
c.) sunk cost
d.) differential cost ✔Correct Answer-sunk cost
In a job-order costing system that is based on machine-hours, which of the following formulas is
correct?
a.) Predetermined overhead rate = Actual manufacturing overhead / Actual machine-hours
b.) Predetermined overhead rate = Actual manufacturing overhead / Estimated machine-hours
, c.) Predetermined overhead rate = Estimated manufacturing overhead / Estimated machine-
hours
d.) Predetermined overhead rate = Estimated manufacturing overhead / Actual machine-hours
✔Correct Answer-Predetermined overhead rate = Estimated manufacturing overhead /
Estimated machine-hours
Which of the following statements about using a plantwide overhead rate based on direct labor
is correct?
a.) Using a plantwide overhead rate based on direct labor-hours will ensure that direct labor
costs are correctly traced to jobs
b.) Using a plantwide overhead rate based on direct labor costs will ensure that direct labor
costs will be correctly traced to jobs
c.) It is often overly simplistic and incorrect to assume that direct labor-hours is a company's
only manufacturing overhead cost driver
d.) The labor theory of value ensures that using a plantwide overhead rate based on direct labor
will do a reasonably good job of assigning overhead costs to jobs ✔Correct Answer-It is often
overly simplistic and incorrect to assume that direct labor-hours is a company's only
manufacturing overhead cost driver
Which of the following statements is not correct concerning multiple overhead rate systems?
a.) A multiple overhead rate system is more complex than a system based on a single plantwide
overhead rate
b.) A multiple overhead rate system is usually more accurate than a system based on a single
plantwide overhead rate
c.) A company may choose to create a separate overhead rate for each of its production
departments
d.) In departments that are relatively labor-intensive, their overhead costs should be applied to
jobs based on machine-hours rather than on direct labor-hours ✔Correct Answer-In
departments that are relatively labor-intensive, their overhead costs should be applied to jobs
based on machine-hours rather than on direct labor-hours
Under a job-order costing system, the dollar amount transferred from Work in Process to
Finished Goods is the sum of the costs charged to all jobs:
a.) started in process during the period
b.) in process during the period
c.) completed and sold during the period
d.) completed during the period ✔Correct Answer-completed during the period
In process costing, a separate work in process amount is kept for each:
a.) Individual order
100% Verified Answers |Actual Complete Exam |Already
Graded A+
Which of the following would most likely NOT be included as manufacturing overhead in a
furniture factory?
a.) The cost of the glue in a chair.
b.) The amount paid to the individual who stains a chair.
c.) The workman's compensation insurance of the supervisor who oversees production.
d.) The factory utilities of the department in which production takes place. ✔Correct Answer-
The amount paid to the individual who stains a chair
Manufacturing overhead includes:
a.) all direct material, direct labor and administrative costs.
b.) all manufacturing costs expect direct labor.
c.) all manufacturing costs except direct labor and direct materials.
d.) all selling and administrative costs. ✔Correct Answer-all manufacturing costs except direct
labor and direct materials
The cost of electricity for running production equipment is classified as:
Conversion cost Period cost
a.) Yes No
b.) Yes Yes
c.) No Yes
d.) No No ✔Correct Answer-Choice A
A cost incurred in the past that is not relevant to any current decision is classified as a(n):
a.) period cost
b.) opportunity cost
c.) sunk cost
d.) differential cost ✔Correct Answer-sunk cost
In a job-order costing system that is based on machine-hours, which of the following formulas is
correct?
a.) Predetermined overhead rate = Actual manufacturing overhead / Actual machine-hours
b.) Predetermined overhead rate = Actual manufacturing overhead / Estimated machine-hours
, c.) Predetermined overhead rate = Estimated manufacturing overhead / Estimated machine-
hours
d.) Predetermined overhead rate = Estimated manufacturing overhead / Actual machine-hours
✔Correct Answer-Predetermined overhead rate = Estimated manufacturing overhead /
Estimated machine-hours
Which of the following statements about using a plantwide overhead rate based on direct labor
is correct?
a.) Using a plantwide overhead rate based on direct labor-hours will ensure that direct labor
costs are correctly traced to jobs
b.) Using a plantwide overhead rate based on direct labor costs will ensure that direct labor
costs will be correctly traced to jobs
c.) It is often overly simplistic and incorrect to assume that direct labor-hours is a company's
only manufacturing overhead cost driver
d.) The labor theory of value ensures that using a plantwide overhead rate based on direct labor
will do a reasonably good job of assigning overhead costs to jobs ✔Correct Answer-It is often
overly simplistic and incorrect to assume that direct labor-hours is a company's only
manufacturing overhead cost driver
Which of the following statements is not correct concerning multiple overhead rate systems?
a.) A multiple overhead rate system is more complex than a system based on a single plantwide
overhead rate
b.) A multiple overhead rate system is usually more accurate than a system based on a single
plantwide overhead rate
c.) A company may choose to create a separate overhead rate for each of its production
departments
d.) In departments that are relatively labor-intensive, their overhead costs should be applied to
jobs based on machine-hours rather than on direct labor-hours ✔Correct Answer-In
departments that are relatively labor-intensive, their overhead costs should be applied to jobs
based on machine-hours rather than on direct labor-hours
Under a job-order costing system, the dollar amount transferred from Work in Process to
Finished Goods is the sum of the costs charged to all jobs:
a.) started in process during the period
b.) in process during the period
c.) completed and sold during the period
d.) completed during the period ✔Correct Answer-completed during the period
In process costing, a separate work in process amount is kept for each:
a.) Individual order
