ACCT 212 connect exam 2 complete solutions correct answers key

Liberty University ACCT 212 connect exam 2 complete solutions correct answers key

Factory overhead costs may include all of the following except:

Indirect labor costs.

Indirect material costs.

Selling costs.

Assembly supplies.

Factory rent.

Which of the following is not part of the sales activity in the flow of manufacturing activities?

Beginning Finished Goods Inventory

Cost of goods manufactured

Total Finished Goods available for sale

Ending Work in Process Inventory

Total finished goods available for sale

A time ticket is a source document an employee uses to record the number of hours at work and that is used each pay period to determine the total labor cost.

True

False

Labor costs in production can be:

Direct or indirect.

Indirect or sunk.

Direct or payroll.

Indirect or payroll.

Direct or sunk.

During March, the production department of a process operations system completed and transferred to finished goods 20,000 units that were in process at the beginning of March and 180,000 units that were started and completed in March. March's beginning inventory units were 100% complete with respect to materials and 62% complete with respect to conversion. At the end of March, 37,000 additional units were in process in the production department and were 100% complete with respect to materials and 21% complete with respect to conversion. Compute the number of physical units transferred to finished goods.

221,000.

237,000.

175,000.

180,000.

200,000.

A company uses the weighted-average method for inventory costing. At the end of the period, 26,000 units were in the ending Work in Process inventory and are 100% complete for materials and 79% complete for conversion. The equivalent costs per unit are materials, $2.69, and conversion $2.30. Compute the cost that would be assigned to the ending Work in Process inventory for the period.

$117,182.

$215,540.

$114,474.

$184,964.

$170,277.

Process costing systems are commonly used by companies that produce a large volume of standardized units on a continuous basis.

True

False

Hybrid costing systems can only be applied to auto manufacturing.

True

False

A system of accounting in which costs are accumulated and then measured per unit at the end of a period by combining costs per equivalent unit from various departments is a:

General cost accounting system.

Process costing system.

Job order cost accounting system.

Manufacturing cost accounting system.

Work in Process accounting system.

If a department that uses process costing starts the reporting period with 100,000 physical units that were 20% complete with respect to direct labor, the equivalent units of direct labor in Work in Process are 20,000.

True

False

Equivalent units of production refer to the number of units that could have been started and completed given the costs incurred during the period.

True

False

The process cost summary is an important managerial accounting report produced by a process costing system.

True

False

In a process costing system, the purchase of raw materials is debited to the Raw Materials Inventory.

True

False

Dazzle, Inc. produces beads for jewelry making use. The following information summarizes production operations for June. The journal entry to record June production activities for direct labor usage is:

Direct materials used

$87,000

Direct labor used

160,000

Predetermined overhead rate (based on direct labor)

155%

Goods transferred to finished goods

432,000

Cost of goods sold

444,000

Credit sales

810,000

Debit Factory Payroll Payable $160,000; credit Cash $160,000.

Debit Work in Process Inventory $160,000; credit Factory Payroll Payable $160,000.

Debit Cost of Goods Sold $160,000; credit Factory Payroll Payable $160,000.

Debit Work in Process Inventory $160,000; credit Raw Materials Inventory $160,000.

Debit Work in Process Inventory $160,000; credit Cash $160,000.

If the predetermined overhead allocation rate is 245% of direct labor cost, and the Baking Department's direct labor cost for the reporting period is $10,000, the following entry would be made to record the allocation of overhead to the products processed in this department:

Work in Process Inventory, Baking Dept

24,500

  Factory Overhead

24,500

True

False

Dazzle, Inc. produces beads for jewelry making use. The following information summarizes production operations and sales activities for June. The journal entry to record June sales is:

Direct materials used

$87,000

Direct labor used

160,000

Predetermined overhead rate (based on direct labor)

155%

Goods transferred to finished goods

432,000

Cost of goods sold

444,000

Credit sales

810,000

Debit Accounts Receivable $810,000; credit Cost of Goods Sold $810,000.

Debit Accounts Receivable $810,000; credit Sales $366,000; credit Finished Goods Inventory $444,000.

Debit Cost of Goods Sold $444,000; credit Sales $444,000.

Debit Finished Goods Inventory $444,000; debit Sales $810,000; credit Accounts Receivable $810,000; credit Cost of Goods Sold $444,000.

Debit Accounts Receivable $810,000; credit Sales $810,000; debit Cost of Goods Sold $444,000; credit Finished Goods Inventory $444,000.

A company estimates that overhead costs for the next year will be $8,640,000 for indirect labor and $171,500 for factory utilities. The company uses machine hours as its overhead allocation base. If 560,000 machine hours are planned for this next year, what is the company's plantwide overhead rate? (Round to two decimal places)

$0.06 per machine hour.

$15.73 per machine hour.

$15.42 per machine hour.

$0.31 per machine hour.

$3.27 per machine hour.

Which of the following companies would be best served by a plantwide overhead rate?

A company that manufactures many different products and whose operations are an equal mix of labor and mechanized work.

A company that manufactures few products and whose operations are labor intensive.

A company that manufactures many different products and whose operations are highly mechanized.

A company whose products use overhead resources in very different ways.

A company whose products differ in batch size and complexity and consume different amounts of overhead resources.

ABC is significantly less costly to implement and maintain than more traditional overhead costing systems.

True

False

Product costs consist of direct labor, direct materials, manufacturing overhead, and indirect costs.

True

False

From an ABC perspective, what causes costs to be incurred?

Financial transactions.

The volume of units produced.

Debits and credits.

Management decisions.

Activities.

Batch level costs vary with the number of units produced.

True

False

Departments are the cost objects when the plantwide overhead rate method is used.

True

False

By definition, costs classified as overhead are consumed in basically the same manner regardless of the process involved.

True

False

Activity-based costing involves four steps: (1) identify activities and the costs they cause, (2) group similar activities into cost pools, (3) determine an activity rate for each activity cost pool, and (4) allocate overhead costs to products using those activity rates.

True

False