Question 1

Basil Industries reported the following information for December:  What was the total manufacturing cost for Basil for December?

Accepted Answer

The answer of Basil Industries reported the following information for...

Question 2

Which of the following is not a common application base for calculating the predetermined overhead rate?

Accepted Answer

Administrative costs are not a common application base for calculating the predetermined overhead rate. The common application bases are direct labor hours, machine hours, and direct labor costs.

Question 3

Basil Industries reported the following information for December:  How much manufacturing overhead was incurred by Basil during December?

Accepted Answer

Manufacturing overhead incurred = Indirect materials + Indirect labor + Other overhead
Manufacturing overhead incurred = $150,000 + $200,000 + $175,000
Manufacturing overhead incurred = $525,000

Question 4

Cottonwood,Inc.has the following information regarding its Raw Materials Inventory account:  What is the beginning balance of Cottonwood's Raw Materials Inventory account?

Accepted Answer

The answer of Cottonwood,Inc.has the following information regarding its Raw...

Question 5

Basil Industries reported the following information for December:  What was the ending balance in Basil's Work in Process Inventory account?

Accepted Answer

The ending balance in Work in Process Inventory can be found by adding together the direct materials, direct labor, and manufacturing overhead costs incurred for the month, and then subtracting the cost of goods manufactured. Using the information provided, we get: Direct materials: $25,000 Direct labor: $50,000 Manufacturing overhead: $37,500 Total manufacturing costs: $112,500 Cost of goods manufactured: $25,000 + $87,500 - $50,000 = $62,500 Ending balance in Work in Process Inventory: $112,500 - $62,500 = $<<112500-62500=50000>>50,000. Therefore, option B is the correct answer.

Question 6

SW Industries has the following information regarding its Raw Materials Inventory account:  What is the cost of materials purchased by SW Industries during the month?

Accepted Answer

The cost of materials purchased can be calculated by taking the ending balance of Raw Materials Inventory and subtracting the beginning balance, then adding any direct purchases made during the month. In this case, the beginning balance is not provided, but the ending balance is $370,300. Therefore, the cost of materials purchased must be the ending balance minus any direct purchases made during the month. Choice B is the only option that is less than the ending balance and could feasibly represent the cost of direct purchases.

Question 7

At the beginning of the year,managers at King Industries estimated $420,000 in manufacturing overhead,20,000 direct labor hours and 50,000 machine hours.Actual manufacturing costs at the end of the year were $425,000 in manufacturing overhead.During the year 22,000 direct labor hours and 47,000 machine hours were incurred.If overhead is applied based on direct labor hours,what is the predetermined overhead rate for the coming year?

Accepted Answer

The answer of At the beginning of the year,managers at...

Question 8

If the beginning balance in Raw Materials Inventory is $5,000,the ending balance is $3,500,and $60,000 was the amount transferred to Work in Process Inventory,what is the amount of materials purchased during the period?

Accepted Answer

Beginning balance + Purchases - Ending balance = Amount transferred to Work in Process Inventory$5,000 + Purchases - $3,500 = $60,000Purchases = $60,000 + $3,500 - $5,000Purchases = $58,500

Question 9

Basil Industries reported the following information for December:  What was the ending balance in Basil's Raw Materials Inventory account?

Accepted Answer

To find the ending balance in Raw Materials Inventory, we need to calculate the beginning balance plus the cost of materials purchased during the month minus the cost of materials used in production. Beginning balance was $100,000, purchases were $200,000, and materials used in production were $181,250 (given as total manufacturing costs minus direct labor and factory overhead). Therefore, the ending balance is $118,750 ($100,000 + $200,000 - $181,250).

Question 10

The predetermined overhead rate is calculated as

Accepted Answer

The predetermined overhead rate is calculated by dividing the estimated overhead cost by the estimated activity level. This rate is then used to apply overhead to products or services based on actual activity levels. Choice D is the correct option because it correctly identifies the formula for calculating the predetermined overhead rate.

Question 11

If the beginning balance in Raw Materials Inventory is $5,000,the ending balance is $3,500,and $60,000 was purchased,what is the amount of materials transferred to Work in Process Inventory during the period?

Accepted Answer

Raw Materials Used = Beginning balance + Purchases - Ending balance
Raw Materials Used = $5,000 + $60,000 - $3,500
Raw Materials Used = $61,500

Since Raw Materials Used = Materials transferred to Work in Process Inventory,
the answer is $61,500, which corresponds to choice C.

Question 12

Basil Industries reported the following information for December:  What was the ending balance in Basil's Finished Goods Inventory account?

Accepted Answer

The answer of Basil Industries reported the following information for...

Question 13

The amount of manufacturing overhead applied to a particular job is calculated as

Accepted Answer

The manufacturing overhead applied to a job is calculated by multiplying the predetermined overhead rate by the actual activity level of the application base used by the job.

Question 14

Which of the following is not a reason to allocate overhead?

Accepted Answer

Allocation is not necessarily more accurate than tracing items directly to jobs. In fact, allocating overhead can often lead to over- or under-allocation, whereas tracing items directly to jobs provides a more accurate reflection of the actual overhead costs incurred for each job.

Question 15

Basil Industries reported the following information for December:  What was the cost of the direct materials used by Basil in production?

Accepted Answer

The cost of direct materials used can be calculated using the following formula: Beginning inventory of raw materials + Purchases of raw materials - Ending inventory of raw materials = Cost of direct materials used. Plugging in the given numbers, we get:
$140,000 + $608,750 - $386,250 = $362,500, which is option B.

Question 16

Vest Manufacturing Company applies overhead cost based on 120% of direct labor cost.In completing the 250

Accepted Answer

To find the overhead cost, we need to multiply the direct labor cost by the predetermined overhead rate of 120%.

Direct labor cost = 250 x $24 = $6,000

Overhead cost = $6,000 x 120% = $7,200

Total manufacturing cost = Direct materials cost + Direct labor cost + Overhead cost

Total manufacturing cost = $4,800 + $6,000 + $7,200 = $18,000

Therefore, the total cost of manufacturing 250 vests is $18,000. However, the question asks for the contribution margin, which is calculated as follows:

Contribution margin = Selling price - Total manufacturing cost

Contribution margin = $78 - $18,000 = -$17,922

Since the contribution margin is negative, it means that the company is losing money by producing and selling vests at this price.

We can also check the answer choices to see which one matches the calculated total manufacturing cost of $18,000. The only option that matches is C) $20,400, which is 120% of the total direct labor cost of $6,000.

Question 17

The predetermined overhead rate is calculated as

Accepted Answer

The predetermined overhead rate is calculated by dividing the budgeted total manufacturing overhead by the budgeted activity level of the application base. This calculation is done to estimate the cost of manufacturing overhead that will be incurred in the future based on the expected level of activity. The actual overhead costs are then compared to the estimated costs to determine if cost variances occurred. Choice A corresponds to this calculation method, and it is the best choice. Choices B, C, and D do not reflect the appropriate calculation method for the predetermined overhead rate.

Question 18

If the ending balance in Raw Materials Inventory is $3,500,$60,000 was purchased,and $61,500 was transferred to Work in Process Inventory during the period,what was the amount in beginning inventory?

Accepted Answer

The beginning inventory can be calculated using the formula: Beginning Inventory + Purchases - Transfers to Work in Process = Ending Inventory. Plugging in the values: Beginning Inventory + $60,000 - $61,500 = $3,500. Solving for Beginning Inventory gives $5,000.

Question 19

At the beginning of the year,managers at King Industries estimated $400,000 in manufacturing overhead,20,000 direct labor hours and 50,000 machine hours.Actual manufacturing costs at the end of the year were $425,000 in manufacturing overhead.During the year 22,000 direct labor hours and 47,000 machine hours were incurred.If overhead is applied based on direct labor hours,how much overhead was applied during the year?

Accepted Answer

The overhead rate based on direct labor hours is calculated as estimated manufacturing overhead divided by estimated direct labor hours, which is $400,000 / 20,000 = $20 per direct labor hour. The overhead applied during the year is then this rate multiplied by the actual direct labor hours incurred, which is $20 * 22,000 = $440,000.

Question 20

An application base should be an activity that

Accepted Answer

The answer of An application base should be an activity...

Quiz 4: Product Costs and Job Order Costing

Basil Industries reported the following information for December: What was the total manufacturing cost for Basil for December?

Which of the following is not a common application base for calculating the predetermined overhead rate?

Basil Industries reported the following information for December: How much manufacturing overhead was incurred by Basil during December?

Cottonwood,Inc.has the following information regarding its Raw Materials Inventory account: What is the beginning balance of Cottonwood's Raw Materials Inventory account?

Basil Industries reported the following information for December: What was the ending balance in Basil's Work in Process Inventory account?

SW Industries has the following information regarding its Raw Materials Inventory account: What is the cost of materials purchased by SW Industries during the month?

If the beginning balance in Raw Materials Inventory is $5,000,the ending balance is $3,500,and $60,000 was the amount transferred to Work in Process Inventory,what is the amount of materials purchased during the period?

Basil Industries reported the following information for December: What was the ending balance in Basil's Raw Materials Inventory account?

The predetermined overhead rate is calculated as

If the beginning balance in Raw Materials Inventory is $5,000,the ending balance is $3,500,and $60,000 was purchased,what is the amount of materials transferred to Work in Process Inventory during the period?

Basil Industries reported the following information for December: What was the ending balance in Basil's Finished Goods Inventory account?

The amount of manufacturing overhead applied to a particular job is calculated as

Which of the following is not a reason to allocate overhead?

Basil Industries reported the following information for December: What was the cost of the direct materials used by Basil in production?

Vest Manufacturing Company applies overhead cost based on 120% of direct labor cost.In completing the 250

The predetermined overhead rate is calculated as

If the ending balance in Raw Materials Inventory is $3,500,$60,000 was purchased,and $61,500 was transferred to Work in Process Inventory during the period,what was the amount in beginning inventory?

An application base should be an activity that