Question 1

Match the following cost flows with the proper event in a job-costing firm:
-immaterial overhead variance closed to costs of goods sold

Accepted Answer

At the end of the year, immaterial overhead variances are typically closed to the cost of goods sold to adjust the accounts and reflect the actual costs incurred.

Question 2

Match the following cost flows with the proper event in a job-costing firm:
-the costs of job are transferred from the work-in-process account to finished goods account

Accepted Answer

The costs of a job are transferred from the work-in-process account to finished goods account upon the completion of the job.

Answer: D
 The product is sold, and the costs associated with it are transferred from the finished goods account to the cost of goods sold account.

Answers B, C, and E are not applicable to the cost flows mentioned in the question.

Question 3

Match each item with the correct statement below. Answers may be used more than once.
-The job order number, or name, head this form.

Accepted Answer

The job-order cost sheet is the form that contains the job order number or name at the top.

Answer: B
 The time ticket is a form used to record the amount of time spent by each employee working on a particular job, so it does not have a job order number or name at the top.

Answer: C
 The materials requisition form is a form used to request the materials needed for a particular job, so it does not have a job order number or name at the top.

Question 4

Match the following cost flows with the proper event in a job-costing firm:
-cost of materials is removed from materials account and added to work-in- process account

Accepted Answer

When materials are moved from storage into production, their cost is removed from the materials account and added to the work-in-process account.

Answer: A
 When a job is completed, its total cost is determined and removed from the work-in-process account and added to the finished goods account.

Answer: D
 When a product is sold, its cost is removed from the finished goods account and added to the cost of goods sold account. The materials cost would have already been included in the finished goods account.

The other choices (B and E) do not involve the specific event of cost flowing from the materials account to the work-in-process account.

Question 5

Match the following cost flows with the proper event in a job-costing firm:
-direct materials, direct labor and applied overhead are totaled to yield manufacturing cost of job

Accepted Answer

Manufacturing cost of a job is totaled at the completion of the job.

Answer: B 
 End of each accounting period is when the total cost incurred for all jobs is tallied, including direct materials, direct labor, and applied overhead.

Answer: C 
 Moving materials from storage to production signifies the beginning of incurring direct materials costs for a job.

Answer: D 
 Sold products do not incur any additional costs, as they have already been completed and accounted for in the total manufacturing cost of the job.

Answer: E 
 The end of the year is not usually a significant event in a job-costing firm for cost flows. It may be used for financial statement reporting purposes, but it does not coincide with any specific job events.

Question 6

Match each item with the correct statement below.
-The amount by which applied overhead exceeds actual overhead

Accepted Answer

Overapplied overhead refers to the situation where the overhead applied to products (using the predetermined overhead rate) exceeds the actual overhead costs incurred.

Question 7

Match each item with the correct statement below. Answers may be used more than once.
-Every time a new job is started this is prepared.

Accepted Answer

A job-order cost sheet is prepared every time a new job is started to track the costs associated with production.

Answer: B 
 A time ticket is prepared every time an employee works on a specific job to track the amount of time spent.

Answer: C 
 A materials requisition form is prepared every time materials are needed for a specific job to track the inventory used and the associated costs.

Question 8

Match each item with the correct statement below. Answers may be used more than once.
-This form may be used to maintain proper control over a firm's inventory of direct materials.

Accepted Answer

A materials requisition form is used to document the authorization to remove raw materials from inventory for use in manufacturing. This helps to maintain proper control over the inventory of direct materials.

Answer: A 
 A job-order cost sheet is used to accumulate the direct and indirect costs associated with a specific job or project. It includes the direct materials, direct labor, and manufacturing overhead costs associated with the job.

Answer: B 
 A time ticket is used to record the amount of time an employee spends on a specific job or project. It is used to calculate the direct labor costs associated with the job. It is not typically used to control inventory of direct materials.

Question 9

Match the following cost flows with the proper event in a job-costing firm:
-costs of product are removed from finished goods and added to cost of goods sold

Accepted Answer

When a product is sold, the costs associated with it are removed from finished goods and added to cost of goods sold.

Answer: B and E
 At the end of each accounting period and the end of the year, the costs of unfinished jobs are transferred from work in progress to finished goods inventory or cost of goods sold, depending on their completion status.

Question 10

Match each item with the correct statement below.
-Estimated overhead for a single department divided by the estimated activity level for that same department

Accepted Answer

The departmental overhead rate is calculated by dividing the estimated overhead for a single department by the estimated activity level for that department.

Answer: A
 The predetermined overhead rate is an estimate of the overhead costs that will be incurred by a specific department or plant and is calculated by dividing the estimated total manufacturing overhead costs by the estimated total amount of the allocation base.

Answer: B
 The plantwide overhead rate is calculated by dividing the estimated total manufacturing overhead costs by the estimated total amount of the allocation base for the entire plant.

Answer: D
 Overhead variance refers to the difference between the actual overhead costs incurred and the estimated overhead costs.

Answer: E
 Overapplied overhead occurs when estimated overhead costs exceed actual overhead costs.

Answer: F
 Underapplied overhead occurs when actual overhead costs exceed estimated overhead costs.

Answer: G
 Applied overhead refers to the amount of overhead costs that are allocated to a specific product or job based on the predetermined overhead rate.

Answer: H
 The normal cost of goods sold refers to the cost of goods sold using the predetermined overhead rate and the actual amount of the allocation base.

Question 11

Match each item with the correct statement below.
-A single overhead rate calculated using all estimated overhead for a factory divided by the estimated activity level across the entire factory

Accepted Answer

A plantwide overhead rate is calculated using all estimated overhead for a factory divided by the estimated activity level across the entire factory.

Answer: A
 A predetermined overhead rate is a single overhead rate calculated using all estimated overhead for a factory divided by the estimated activity level across the entire factory.

Answer: C
 A departmental overhead rate is calculated separately for each department based on that department's estimated overhead costs and activity levels.

Answer: D
 Overhead variance refers to the difference between actual overhead costs incurred and applied overhead costs.

Answer: E
 Overapplied overhead occurs when the actual overhead costs incurred are less than the overhead costs applied.

Answer: F
 Underapplied overhead occurs when the actual overhead costs incurred are greater than the overhead costs applied.

Answer: G
 Applied overhead refers to the amount of overhead costs that have been allocated to a particular job or product.

Answer: H
 Normal cost of goods sold refers to the cost of goods sold that includes only actual direct material and direct labor costs, as well as overhead costs that have been applied.

Question 12

Match the following cost flows with the proper event in a job-costing firm:
-schedule of costs of goods sold is prepared

Accepted Answer

The preparation of the schedule of costs of goods sold typically occurs at the end of each accounting period, so the best match is choice B.

Answer: A 
 The completion of a job is typically associated with the transfer of costs from work-in-progress inventory to finished goods inventory, so the best match is choice A.

Answer: C 
 The movement of materials from storage into production typically triggers the recording of cost information in the accounting system, so the best match is choice C.

Answer: D 
 The sale of a product typically results in the recognition of revenue and a corresponding reduction in inventory levels, so the best match is choice D.

Answer: E 
 The end of the year may prompt various activities related to accounting, such as the preparation of financial statements, but it does not have a specific cost flow associated with it in a job-costing firm. None of the choices are a good match for this scenario.

Question 13

Match each item with the correct statement below. Answers may be used more than once.
-This form is filled out by each employee every day.

Accepted Answer

A time ticket is filled out by each employee every day to track their time and calculate their wages.

Answer: C
 A materials requisition form is used to request the materials needed for a particular job or task. It is typically filled out by the supervisor or department head in charge of the project.

Answer: A
 A job-order cost sheet is used to track the costs associated with a specific job or project. It includes information on materials, labor, and overhead costs incurred during the production process. It is typically maintained by the accounting department or project manager.

Question 14

Match the following cost flows with the proper event in a job-costing firm:
-actual overhead is reconciled with applied overhead

Accepted Answer

The reconciliation of actual overhead with applied overhead typically occurs at the end of each accounting period, which is when the actual costs incurred are compared to the estimated costs. This helps to ensure that overhead is allocated accurately to the various jobs within the firm.

Answer: E
 The end of the year is another common time for reconciling actual overhead with applied overhead, as part of the year-end financial reporting and analysis. This allows the company to determine its total overhead costs for the year and adjust its pricing and cost structure accordingly.

Answers A, C, and D do not relate specifically to the reconciliation of actual overhead with applied overhead and therefore are not the best choices for this cost flow.

Question 15

Match each item with the correct statement below. Answers may be used more than once.
-This form asks for the type, quantity, and unit price of direct materials.

Accepted Answer

The materials requisition form is the document used to request direct materials for a specific job or project. It includes information about the type and quantity of materials needed, as well as their unit price.

Answer: A
 The job-order cost sheet is used to track the costs associated with a specific job or project, including direct materials. It includes information about the materials used, the labor costs incurred, and any overhead expenses.

Answer: none of the above
 The time ticket is used to track employee time and labor costs, so it is not directly related to the tracking of direct materials.

Quiz 4: Job-Order Costing and Normal Cost Overhead Application

Match the following cost flows with the proper event in a job-costing firm: -immaterial overhead variance closed to costs of goods sold

Match the following cost flows with the proper event in a job-costing firm: -the costs of job are transferred from the work-in-process account to finished goods account

Match each item with the correct statement below. Answers may be used more than once. -The job order number, or name, head this form.

Match the following cost flows with the proper event in a job-costing firm: -cost of materials is removed from materials account and added to work-in- process account

Match the following cost flows with the proper event in a job-costing firm: -direct materials, direct labor and applied overhead are totaled to yield manufacturing cost of job

Match each item with the correct statement below. -The amount by which applied overhead exceeds actual overhead

Match each item with the correct statement below. Answers may be used more than once. -Every time a new job is started this is prepared.

Match each item with the correct statement below. Answers may be used more than once. -This form may be used to maintain proper control over a firm's inventory of direct materials.

Match the following cost flows with the proper event in a job-costing firm: -costs of product are removed from finished goods and added to cost of goods sold

Match each item with the correct statement below. -Estimated overhead for a single department divided by the estimated activity level for that same department

Match each item with the correct statement below. -A single overhead rate calculated using all estimated overhead for a factory divided by the estimated activity level across the entire factory

Match the following cost flows with the proper event in a job-costing firm: -schedule of costs of goods sold is prepared

Match each item with the correct statement below. Answers may be used more than once. -This form is filled out by each employee every day.

Match the following cost flows with the proper event in a job-costing firm: -actual overhead is reconciled with applied overhead

Match each item with the correct statement below. Answers may be used more than once. -This form asks for the type, quantity, and unit price of direct materials.