Question 1

Leonard Manufacturing Systems uses job order costing and a perpetual inventory system.When recording the sale of a job,which account(s)is(are)debited?

Accepted Answer

The answer of Leonard Manufacturing Systems uses job order costing...

Question 2

On June 30,Cleopatra,Inc.finished Job 70 with total job costs of $40,000 and transferred the costs to Finished Goods Inventory.On July 6,Cleopatra completed the sale of the goods to a customer for $55,000 on account.Provide the journal entry to record the sales revenue.Omit explanation.

Accepted Answer

The answer of On June 30,Cleopatra,Inc.finished Job 70 with total...

Question 3

During the year,a company incurred $520,000 of manufacturing overhead costs and allocated $480,000 of manufacturing overhead costs.At year-end,the adjustment entry needed to adjust the Manufacturing Overhead account balance to zero will include a debit to Cost of Goods Sold.

Accepted Answer

Since the Manufacturing Overhead account balance needs to be adjusted to zero at year-end, any remaining balance will need to be transferred to the Cost of Goods Sold account, resulting in a debit to Cost of Goods Sold.

Question 4

On June 30,Coral,Inc.finished Job 750 with total job costs of $4700,and transferred the costs to Finished Goods Inventory.On July 6,Coral sold goods to a customer for $5000 cash.Which of the following is the correct journal entry to record the cost of goods sold? Assume the perpetual inventory system is used.

Accepted Answer

Journal entry:
 11ea8873_d511_2a76_bb89_93230e2f4691_TB5026_00

Question 5

Jupiter Manufacturing began business on January 1.During its first year of operation,Jupiter worked on five industrial jobs and reported the following information at year-end: $$\begin{array} { | l | r | r | r | r | r | } 
\hline & \text { Job 1 } & \text { Job 2 } & \text { Job 3 } & \text { Job 4 } & \text { Job 5 } \
\hline \text { Direct Materials } & \$ 1,000 & \$ 7,500 & \$ 4,000 & \$ 3,500 & \$ 1700 \
\hline \text { Direct Labor } & 12,000 & 20,000 & 13,000 & 12,000 & 700 \
\hline \text { Allocated Mfg. Overhead } & 1,500 & 6,000 & 2,500 & 7,500 & 400 \
\hline & & & & & \text { Not } \
\text { Job completed: } & \text { Jun 30 } & \text { Sep 1 } & \text { Oct 15 } & \text { Nov 1 } & \text { completed } \
\hline \text { Job sold: } & \text { Jul 10 } & \text { Sep 12 } & \text { Not sold } & \text { Not sold } & \text { N/A } \
\hline \text { Revenues: } & \$ 25,000 & \$ 39,000 & \text { N/A } & \text { N/A } & \text { N/A } \
\hline
\end{array}$$ What was the balance in Work-in-Process Inventory at year-end?

Accepted Answer

The balance in Work-in-Process Inventory at year-end is $2800. This is calculated by adding the costs of the jobs that are not yet completed: Job 3 ($4,000 + $2,500 = $6,500) and Job 5 ($1,700 + $400 = $2,100).

Question 6

Manufacturing overhead costs allocated to a job amounted to $492,000.The actual manufacturing costs incurred during the year were $570,000.Overhead costs have been underallocated.

Accepted Answer

Since the allocated manufacturing overhead costs are less than the actual manufacturing costs incurred, the overhead costs have been underallocated.

Question 7

Patrick Manufacturing Systems uses job order costing and a perpetual inventory system.When recording the sale of a job,which account(s)is(are)credited?

Accepted Answer

The answer of Patrick Manufacturing Systems uses job order costing...

Question 8

Hosanna Furnishings finished Job A40,which involved $4,000 of direct materials and $600 of direct labor.Hosanna uses a predetermined overhead allocation rate based on 40% of direct labor costs.Provide the journal entry needed to record the completion of the job.Omit explanation.

Accepted Answer

The answer of Hosanna Furnishings finished Job A40,which involved $4,000...

Question 9

In a job order costing system,a credit to Finished Goods Inventory will be accompanied by a debit to ________.

Accepted Answer

When finished goods are sold, the cost is transferred from Finished Goods Inventory to Cost of Goods Sold, reflecting the expense of the goods sold.

Question 10

Kalliste,Inc.completed Job C50.Job C50 required $3,000 of direct materials cost,$2,000 of direct labor cost,and $600 of allocated manufacturing overhead.Provide the journal entry needed to record completion and transfer of the job.Omit explanation.

Accepted Answer

The answer of Kalliste,Inc.completed Job C50.Job C50 required $3,000 of...

Question 11

At the beginning of the year,Barrington Manufacturing had the following account balances:
      The following additional details are provided for the year:
 $$\begin{array} { | l | r | } 
\hline \text { Direct materials placed in production } & \$ 80,000 \
\hline \text { Direct labor incurred } & 190,000 \
\hline \text { Manufacturing overhead incurred } & 300,000 \
\hline \text { Manufacturing overhead allocated to production } & 295,000 \
\hline \text { Cost of jobs completed } & 500,000 \
\hline
\end{array}$$ Record these transactions in the T-accounts and calculate the ending balances for Work-in-Process Inventory,Finished Goods Inventory,and Manufacturing Overhead accounts (unadjusted).

Accepted Answer

The answer of At the beginning of the year,Barrington Manufacturing...

Question 12

On June 30,Greenville Manufacturing finished Job 70 with total job costs of $40,000 and transferred the costs to Finished Goods Inventory.On July 6,Greenville completed the sale of the goods to a customer for $55,000 on account.Provide the entry to record the cost of goods sold.Omit explanation.Assume the perpetual inventory system is used.

Accepted Answer

The answer of On June 30,Greenville Manufacturing finished Job 70...

Question 13

During the year,a company incurred $498,000 of manufacturing overhead costs and allocated $510,000 of manufacturing overhead costs.At the year-end,the adjustment entry needed to adjust the Manufacturing Overhead account balance to zero will include a debit to Cost of Goods Sold.

Accepted Answer

The answer of During the year,a company incurred $498,000 of...

Question 14

When goods are transferred from the Finished Goods Inventory account to the Cost of Goods Sold account,the product costs move from the balance sheet to the income statement.

Accepted Answer

This is true. When goods are transferred from the Finished Goods Inventory account to the Cost of Goods Sold account, the product costs are recognized as an expense on the income statement, reducing net income for the period. This results in a decrease in the balance of the Finished Goods Inventory account and an increase in the Cost of Goods Sold account.

Question 15

Warren Manufacturing began business on January 1.During its first year of operation,Warren worked on five industrial jobs and reported the following information at year-end: $$\begin{array} { | l | r | r | r | r | r | } 
\hline & \text { Job 1 } & \text { Job 2 } & \text { Job 3 } & \text { Job 4 } & \text { Job 5 } \
\hline \text { Direct Materials } & \$ 1,000 & \$ 7,500 & \$ 4800 &\$ 3700 & \$ 1,500 \
\hline \text { Direct Labor } & 12,000 & 20,000 & 13,800 & 12,700 & 800 \
\hline \text { Allocated Mfg. Overhead } & 1,500 & 6,000 & 2400 & 100 & 200 \
\hline & & & & & \text { Not } \
\text { Job completed: } & \text { Jun 30 } & \text { Sep 1 } & \text { Oct 15 } & \text { Nov 1 } & \text { completed } \
\hline \text { Job sold: } & \text { Jul 10 } & \text { Sep 12 } & \text { Not sold } & \text { Not sold } & \text { N/A } \
\hline \text { Revenues: } & \$ 25,000 & \$ 39,000 & \text { N/A } & \text { N/A } & \text { N/A } \
\hline
\end{array}$$ What was the balance in Finished Goods Inventory at year-end?

Accepted Answer

The balance in Finished Goods Inventory at year-end includes the costs of jobs that were completed but not sold. This includes Job 3 and Job 4. The costs are calculated as follows: Job 3 = $4,800 (Direct Materials) + $13,800 (Direct Labor) + $2,400 (Allocated Mfg. Overhead) = $21,000. Job 4 = $3,700 (Direct Materials) + $12,700 (Direct Labor) + $100 (Allocated Mfg. Overhead) = $16,500. Therefore, the total Finished Goods Inventory is $21,000 (Job 3) + $16,500 (Job 4) = $37,500. However, since this option is not available, it appears there was a mistake in the calculation or in the provided options. Given the options, the closest or intended correct answer might be misstated, so based on the provided information and typical accounting practices, the calculation approach is correct, but the options may not accurately reflect the calculated total.

Question 16

Overallocated manufacturing overhead occurs when the manufacturing overhead allocated to Work-in-Process Inventory is less than the amount actually incurred.

Accepted Answer

Overallocated manufacturing overhead occurs when the manufacturing overhead allocated to Work-in-Process Inventory is greater than the amount actually incurred. This happens when the predetermined overhead rate used to allocate manufacturing overhead is set too high.

Question 17

On January 1,Feldstein Manufacturing had a beginning balance in Work-in-Process Inventory of $81,100 and a beginning balance in Finished Goods Inventory of $22,000.During the year,Feldstein incurred manufacturing costs of $351,000. During the year,the following transactions occurred:
Job A-12 was completed for a total cost of $121,100 and was sold for $126,700.
Job A-13 was completed for a total cost of $201,800 and was sold for $211,000.
Job A-15 was completed for a total cost $60,000 but was not sold as of year-end.
What was the balance in Finished Goods Inventory at the end of the year?

Accepted Answer

11ea8873_d511_2a77_bb89_cf41d7d0500b_TB5026_00

Question 18

On June 30,Caroline,Inc.finished Job 750 with total job costs of $4400 and transferred the costs to Finished Goods Inventory.On July 6,Caroline sold goods from Job 750 to a customer for $6000 cash.Which of the following is the correct entry needed to record the revenue earned? Assume the perpetual inventory system is used.

Accepted Answer

Journal entry:
 11ea8873_d511_0365_bb89_dd1b1b743ffd_TB5026_00

Question 19

Using a job order costing system,Jabari Company sold jobs on account with a selling price of $985,000 and a cost of $410,000.Assume the company uses the perpetual inventory system.The journal entries required to record this transaction are:

Accepted Answer

Option C is correct because it accurately reflects the transaction in a job order costing system under the perpetual inventory system. The sale is recorded by debiting Accounts Receivable and crediting Sales Revenue for the selling price. The cost of the goods sold is recorded by debiting Cost of Goods Sold and crediting Finished Goods Inventory for the cost of the goods.

Question 20

Oxford Manufacturing Company completed jobs that cost $48,000 to produce.In the same period,
the company sold jobs for $102,000 that cost $53,000 to produce.Prepare the journal entries for the completion and sales of the jobs.All sales are on account.Omit explanation.Assume the perpetual inventory system is used.

Accepted Answer

The answer of Oxford Manufacturing Company completed jobs that cost...

Quiz 19: Job Order Costing