, lOMoAR cPSD| 14860549
INTRODUCTIONgTOgCOSTgACCOUNTING
MULTIPLEgCHOICE
1.gggg Factorygoverheadgincludes:
a. Indirectglaborgbutgnotgindirectgmaterials.
b. Indirectgmaterialsgbutgnotgindirectglabor.
c. Allgmanufacturinggcosts,gexceptgindirectgmaterialsgandgindirectglabor.
d. Allgmanufacturinggcosts,gexceptgdirectgmaterialsgandgdirectglabor.
ANS: D
Factorygoverheadgincludesgallgmanufacturinggcostsgexceptgdirectgmaterialsgandgdirectglabor.
2.gggg Thegtermg"primegcost"grefersgto:
a. Thegsumgofgdirectglaborgcostsgandgallgfactorygoverheadgcosts.
b. Thegsumgofgrawgmaterialgcostsgandgdirectglaborgcosts.
c. Allgcostsgassociatedgwithgmanufacturinggothergthangdirectglaborgcostsgandgrawgmaterialgcosts.
d. Manufacturinggcostsgincurredgtogproducegunitsgofgoutput.
ANS: B
Thegtermg"primegcost"grefersgtogthegsumgofgrawgmaterialsgcostsgandgdirectglaborgcosts.
3.gggg Thegtermg"conversiongcosts"grefersgto:
a. Thegsumgofgdirectglaborgcostsgandgallgfactorygoverheadgcosts.
b. Thegsumgofgrawgmaterialgcostsgandgdirectglaborgcosts.
c. Allgcostsgassociatedgwithgmanufacturinggothergthangdirectglaborgcosts.
d. Directglaborgcostsgincurredgtogproducegunitsgofgoutput.
ANS: A
Thegtermg"conversiongcosts"grefersgtogthegsumgofgdirectglaborgcostsgandgallgfactorygoverheadgcosts.
4.gggg Agtypicalgfactorygoverheadgcostgis:
a. Freightgout.
b. Stationerygandgprinting.
c. Depreciationgongmachinerygandgequipment.
d. Postage.
ANS: C
Depreciationgongmachinerygandgequipmentgisgagfactorygoverheadgcostg(i.e.,gitgisgagmanufacturinggcost,gb
utgitgcan'tgbegidentifiedgwithgspecificgjobsgorgprocesses),gwhereasgthegothergthreegitemsgaregsellinggandg
administrativegexpenses.
5.gggg Undergagjobgordergsystemgofgcostgaccounting,gthegdollargamountgofgthegentrygtogtransferginventorygfrom
gWorkgingProcessgtogFinishedgGoodsgisgthegsumgofgthegcostsgchargedgtogallgjobs:
a. Ingprocessgduringgthegperiod.
b. Completedgandgsoldgduringgthegperiod.
c. Completedgduringgthegperiod.
d. Startedgingprocessgduringgthegperiod.
, lOMoAR cPSD| 14860549
ANS: C
Whengjobsgaregcompletedgduringgthegperiod,gFinishedgGoodsgisgdebitedgandgWorkgingProcessgisgcreditedg
forgthegcostgofgthegfinishedgjobs.
6.gggg Whichgofgthegfollowinggproductiongoperationsgwouldgbegmostglikelygtogemploygagjobgordergsystemgofgc
ostgaccounting?ga. Candygmanufacturing
b. Crudegoilgrefining
c. Printinggtextgbooks
d. FlourgMilling
ANS: C
Printinggwouldgbegmostglikelygtogemploygagjobgordergsystemgofgcostgaccountinggduegtogthegnumbergofgc
ustomgjobsginvolved.gThegmanufacturegofgcandy,gthegvulcanizinggofgrubber,gandgthegrefininggofgcrudegoil
gwouldgnormallygbegagcontinuousgprocessgofgproducingglikeggoodsgandgwouldgbegaccountedgforgundergt
hegprocessgcostgsystem.
7.gggg Ingjobgordergcosting,gthegbasicgdocumentgforgaccumulatinggthegcostgofgeachgordergisgthe:ga.gJobgcostgsheet.
b. Requisitiongsheet.
c. Purchasegorder.
d. Invoice.
ANS: A
Ingjobgordergcosting,gthegbasicgdocumentgtogaccumulategthegcostgofgeachgordergisgthegjobgcostgsheet.
8.gggg Whengshouldgprocessgcostinggtechniquesgbegusedgingassigninggcostsgtogproducts?
a. Ingsituationsgwheregstandardgcostinggtechniquesgshouldgnotgbegused
b. Ifgthegproductgisgcomposedgofgmass-producedghomogeneousgunits
c. Whengproductiongisgonlygpartiallygcompletedgduringgthegaccountinggperiod
d. Ifgthegproductgisgmanufacturedgongthegbasisgofgeachgordergreceived
ANS: B
Processgcostinggtechniquesgshouldgbegusedgingassigninggcostsgtogproductsgifgthegproductgisgcomposedgofg
mass-producedghomogeneousgunits.
9. Angindustrygthatgwouldgmostglikelygusegprocessgcostinggproceduresgis:
a. Beverage.
b. HomegConstruction.
c. Printing.
d. Shipbuilding.
ANS: A
Beveragegproductiongusuallygconsistsgofgmanufacturingg"longgruns"gofghomogeneousgproductsgforgwhic
hgprocessgcostinggisgused.g Thegothergthreegindustriesgwouldgutilizegjobgordergcosting.
10.ggggUndergagjobgordergsystemgofgcostgaccounting,gCostgofgGoodsgSoldgisgdebitedgandgFinishedgGoodsgisgc
reditedgforga:ga. Transfergofgmaterialsgtogthegfactory.
b. Shipmentgofgcompletedggoodsgtogthegcustomer.
c. Transfergofgcompletedgproductiongtogthegfinishedggoodsgstoreroom.
d. Purchasegofggoodsgongaccount.
, lOMoAR cPSD| 14860549
ANS: B
Whengcompletedggoodsgaregshippedgtogcustomers,gCostgofgGoodsgSoldgisgdebitedgandgFinishedgGoodsgisg
credited.
11.gggg PayrollgisgdebitedgandgWagesgPayablegisgcreditedgto:
a. Paygthegpayrollgtaxes.
b. Recordgthegpayroll.
c. Paygthegpayroll.
d. Distributegthegpayroll.
ANS: B
Whengthegpayrollgisgrecorded,gPayrollgisgdebitedgandgWagesgPayablegisgcredited.g Whengpayrollgtaxesgare
gpaid,gthegvariousgliabilitygaccountsgaregdebitedgandgCashgisgcredited.gWhengthegpayrollgisgpaid,gWagesg
PayablegisgdebitedgandgCashgisgcredited.gWhengthegpayrollgisgdistributed,gWorkgingProcess,gFactorygOver
head,gandgSellinggandgAdministrativegExpensesgaregdebitedgandgPayrollgisgcredited.
12.ggggSelectedgdatagconcerninggthegpastgfiscalgyear'sgoperationsg(000'sgomitted)gofgthegStanleyg
ManufacturinggCompanygaregpresentedgbelow:
INVENTORIES
Beginning Endin
g
Rawgmaterials $g90 $g85
Workgingprocess 50 65
Finished 100 90
goods
Othergdata:
Rawgmaterialsgused $365
Totalgmanufacturinggcostsgcharged
togproductiongduring
thegyearg(incl
udesgrawgmaterials,gdirectglabor,gandg
factory
overhead) 680
Costgofggoodsgavailablegforgsale 765
Sellinggandggeneralgexpenses 250
Thegcostgofgrawgmaterialsgpurchasedgduringgthegyearga
mountedgto:
a. $455.
b. $450.
c. $365.
d. $360.
ANS:g D
Rawgmaterialsgused $365
Addgendingginventorygofgrawgmaterials 85
INTRODUCTIONgTOgCOSTgACCOUNTING
MULTIPLEgCHOICE
1.gggg Factorygoverheadgincludes:
a. Indirectglaborgbutgnotgindirectgmaterials.
b. Indirectgmaterialsgbutgnotgindirectglabor.
c. Allgmanufacturinggcosts,gexceptgindirectgmaterialsgandgindirectglabor.
d. Allgmanufacturinggcosts,gexceptgdirectgmaterialsgandgdirectglabor.
ANS: D
Factorygoverheadgincludesgallgmanufacturinggcostsgexceptgdirectgmaterialsgandgdirectglabor.
2.gggg Thegtermg"primegcost"grefersgto:
a. Thegsumgofgdirectglaborgcostsgandgallgfactorygoverheadgcosts.
b. Thegsumgofgrawgmaterialgcostsgandgdirectglaborgcosts.
c. Allgcostsgassociatedgwithgmanufacturinggothergthangdirectglaborgcostsgandgrawgmaterialgcosts.
d. Manufacturinggcostsgincurredgtogproducegunitsgofgoutput.
ANS: B
Thegtermg"primegcost"grefersgtogthegsumgofgrawgmaterialsgcostsgandgdirectglaborgcosts.
3.gggg Thegtermg"conversiongcosts"grefersgto:
a. Thegsumgofgdirectglaborgcostsgandgallgfactorygoverheadgcosts.
b. Thegsumgofgrawgmaterialgcostsgandgdirectglaborgcosts.
c. Allgcostsgassociatedgwithgmanufacturinggothergthangdirectglaborgcosts.
d. Directglaborgcostsgincurredgtogproducegunitsgofgoutput.
ANS: A
Thegtermg"conversiongcosts"grefersgtogthegsumgofgdirectglaborgcostsgandgallgfactorygoverheadgcosts.
4.gggg Agtypicalgfactorygoverheadgcostgis:
a. Freightgout.
b. Stationerygandgprinting.
c. Depreciationgongmachinerygandgequipment.
d. Postage.
ANS: C
Depreciationgongmachinerygandgequipmentgisgagfactorygoverheadgcostg(i.e.,gitgisgagmanufacturinggcost,gb
utgitgcan'tgbegidentifiedgwithgspecificgjobsgorgprocesses),gwhereasgthegothergthreegitemsgaregsellinggandg
administrativegexpenses.
5.gggg Undergagjobgordergsystemgofgcostgaccounting,gthegdollargamountgofgthegentrygtogtransferginventorygfrom
gWorkgingProcessgtogFinishedgGoodsgisgthegsumgofgthegcostsgchargedgtogallgjobs:
a. Ingprocessgduringgthegperiod.
b. Completedgandgsoldgduringgthegperiod.
c. Completedgduringgthegperiod.
d. Startedgingprocessgduringgthegperiod.
, lOMoAR cPSD| 14860549
ANS: C
Whengjobsgaregcompletedgduringgthegperiod,gFinishedgGoodsgisgdebitedgandgWorkgingProcessgisgcreditedg
forgthegcostgofgthegfinishedgjobs.
6.gggg Whichgofgthegfollowinggproductiongoperationsgwouldgbegmostglikelygtogemploygagjobgordergsystemgofgc
ostgaccounting?ga. Candygmanufacturing
b. Crudegoilgrefining
c. Printinggtextgbooks
d. FlourgMilling
ANS: C
Printinggwouldgbegmostglikelygtogemploygagjobgordergsystemgofgcostgaccountinggduegtogthegnumbergofgc
ustomgjobsginvolved.gThegmanufacturegofgcandy,gthegvulcanizinggofgrubber,gandgthegrefininggofgcrudegoil
gwouldgnormallygbegagcontinuousgprocessgofgproducingglikeggoodsgandgwouldgbegaccountedgforgundergt
hegprocessgcostgsystem.
7.gggg Ingjobgordergcosting,gthegbasicgdocumentgforgaccumulatinggthegcostgofgeachgordergisgthe:ga.gJobgcostgsheet.
b. Requisitiongsheet.
c. Purchasegorder.
d. Invoice.
ANS: A
Ingjobgordergcosting,gthegbasicgdocumentgtogaccumulategthegcostgofgeachgordergisgthegjobgcostgsheet.
8.gggg Whengshouldgprocessgcostinggtechniquesgbegusedgingassigninggcostsgtogproducts?
a. Ingsituationsgwheregstandardgcostinggtechniquesgshouldgnotgbegused
b. Ifgthegproductgisgcomposedgofgmass-producedghomogeneousgunits
c. Whengproductiongisgonlygpartiallygcompletedgduringgthegaccountinggperiod
d. Ifgthegproductgisgmanufacturedgongthegbasisgofgeachgordergreceived
ANS: B
Processgcostinggtechniquesgshouldgbegusedgingassigninggcostsgtogproductsgifgthegproductgisgcomposedgofg
mass-producedghomogeneousgunits.
9. Angindustrygthatgwouldgmostglikelygusegprocessgcostinggproceduresgis:
a. Beverage.
b. HomegConstruction.
c. Printing.
d. Shipbuilding.
ANS: A
Beveragegproductiongusuallygconsistsgofgmanufacturingg"longgruns"gofghomogeneousgproductsgforgwhic
hgprocessgcostinggisgused.g Thegothergthreegindustriesgwouldgutilizegjobgordergcosting.
10.ggggUndergagjobgordergsystemgofgcostgaccounting,gCostgofgGoodsgSoldgisgdebitedgandgFinishedgGoodsgisgc
reditedgforga:ga. Transfergofgmaterialsgtogthegfactory.
b. Shipmentgofgcompletedggoodsgtogthegcustomer.
c. Transfergofgcompletedgproductiongtogthegfinishedggoodsgstoreroom.
d. Purchasegofggoodsgongaccount.
, lOMoAR cPSD| 14860549
ANS: B
Whengcompletedggoodsgaregshippedgtogcustomers,gCostgofgGoodsgSoldgisgdebitedgandgFinishedgGoodsgisg
credited.
11.gggg PayrollgisgdebitedgandgWagesgPayablegisgcreditedgto:
a. Paygthegpayrollgtaxes.
b. Recordgthegpayroll.
c. Paygthegpayroll.
d. Distributegthegpayroll.
ANS: B
Whengthegpayrollgisgrecorded,gPayrollgisgdebitedgandgWagesgPayablegisgcredited.g Whengpayrollgtaxesgare
gpaid,gthegvariousgliabilitygaccountsgaregdebitedgandgCashgisgcredited.gWhengthegpayrollgisgpaid,gWagesg
PayablegisgdebitedgandgCashgisgcredited.gWhengthegpayrollgisgdistributed,gWorkgingProcess,gFactorygOver
head,gandgSellinggandgAdministrativegExpensesgaregdebitedgandgPayrollgisgcredited.
12.ggggSelectedgdatagconcerninggthegpastgfiscalgyear'sgoperationsg(000'sgomitted)gofgthegStanleyg
ManufacturinggCompanygaregpresentedgbelow:
INVENTORIES
Beginning Endin
g
Rawgmaterials $g90 $g85
Workgingprocess 50 65
Finished 100 90
goods
Othergdata:
Rawgmaterialsgused $365
Totalgmanufacturinggcostsgcharged
togproductiongduring
thegyearg(incl
udesgrawgmaterials,gdirectglabor,gandg
factory
overhead) 680
Costgofggoodsgavailablegforgsale 765
Sellinggandggeneralgexpenses 250
Thegcostgofgrawgmaterialsgpurchasedgduringgthegyearga
mountedgto:
a. $455.
b. $450.
c. $365.
d. $360.
ANS:g D
Rawgmaterialsgused $365
Addgendingginventorygofgrawgmaterials 85
