Cost Allocation Techniques Paper 11

1

The journal entry to record applying overhead during the production process is:






2

When manufacturing overhead is applied to production, it is added to:






3

Which of the following statements is true?
I. Overhead application may be made slowly as a job is worked on.
II. Overhead application may be made in a single application at the time of completion of the job.
III. Overhead application should be made to any job not completed at year-end in order to properly value the work in process inventory.






4

On the Schedule of Cost of Goods Manufactured, the final Cost of Goods Manufactured figure represents:






5

If a company applies overhead to production on the basis of a predetermined rate, a debit balance in the Manufacturing Overhead account at the end of the period means that:






6

Overapplied overhead means that:






7

The corporate controller’s salary would be considered a(n):






8

A company allocates overhead to jobs in process using direct labor costs, raw material costs and machine hours. The overhead application rates for the current year are:
100% of direct labor.
20% of raw materials.
$117 per machine hour.
A particular production run incurred the following costs:
Direct labor, $8,000
Raw materials, $2,000
A total of 140 machine hours were required for the production run.
What is the total cost that would be charged to the production run?






9

The following information is available from the records of a manufacturing company that applies factory overhead based on direct labor hours.
Estimated overhead cost $500,000
Estimated labor hours 200,000
Actual overhead cost 515,000
Actual labor hours 210,000
Based on this information, factory overhead is:






10

On January 1, 2005, the first year of operations, Paterno Co. had the following annual budget.
Units 20.000
Sales $120,000
Minus:
Total variable expenses 70,000
Total fixed expenses 25.000
Net income $25,000
Factory overhead:
Variable $40,000
Fixed $40,000
At the end of the first year, there were no units in progress and the actual total factory overhead incurred was $45,000. There was also $3,000 of overapplied factory overhead. Factory overhead was allocated on a basis of budgeted units of production. How many units did Paterno produce this year?






Result

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