Reference no: EM13569063

1.The basic types of cost accounting systems are:

• Job order cost systems, activity based cost systems, and process cost systems.
• Direct cost systems and indirect cost systems.
• Completed job cost systems and work in process cost systems.
• Fixed cost systems and variable cost systems.

2.Under a job order cost system, costs are accumulated for:

• Each department in the production cycle.
• Each batch of production, known as a job or lot.
• Each individual unit produced.
• Each job supervisor.

3.Which of the following statements is true about activity-based costing?

• Only one activity should be used for a company.
• Many different activity bases are used in applying overhead.
• There can only be one cost driver.
• Direct materials and direct labor are applied to work-in-process based upon cost drivers.

4.Manufacturing overhead is:

• A direct cost that can traced to a specific job.
• An indirect cost that can be traced to a specific job.
• A direct cost that cannot be traced to a specific job.
• An indirect cost that cannot be traced to a specific job.

5.A summary of work completed with related unit and total costs in a process costing system is called a(n):

• Equivalent units production form.
• Cost requisition form.
• Summary of conversion costs.
• Production cost report.

6.Process cost systems:

• Are good when companies produce homogeneous units.
• May have work-in-process accounts for each department.
• Use equivalent units of production.
• All of the above.

7.Per-unit costs:

• Are relevant only when a company is engaged in manufacturing activities.
• Are determined in job order cost systems but cannot be computed when a process cost system is in use.
• Are relevant in manufacturing, merchandising, and service industries, regardless of the type of cost accounting system in use.
• Are determined by relating manufacturing costs to the number of units sold.

8.Equivalent units are usually computed for:

• Only direct materials.
• Only direct labor.
• Only factory overhead.
• All three of the above.

9.Which of the following costing systems would always use job cost sheets?

• Job order costing.
• Process costing.
• Activity-based costing.
• All three systems.

10.The basic types of cost accounting systems are:

• Direct cost systems and indirect cost systems.
• Fixed cost systems and variable cost systems.
• Completed job cost systems and work in process cost systems.
• Job order cost systems, activity based cost systems, and process cost systems.

11.A job order cost system would be appropriate in the manufacture of:

• Breakfast cereal.
• Standard-grade plywood.
• Custom-made furniture.
• Paints.

12.A job order cost system traces direct materials cost to a particular job by means of:

• A production budget.
• Materials requisitions.
• The Materials Inventory controlling account.
• A debit to the job cost sheet for the job.

13.A job cost sheet should:

• Contain information that summarizes all jobs finished.
• Contain information on each individual job in process.
• Contain only the direct costs of a particular job.
• Only be used for jobs that have been completed.

14.Underapplied overhead at the end of a month:

• Is represented by a credit balance remaining in the Manufacturing Overhead account.
• Is represented by a debit balance remaining in the Manufacturing Overhead account.
• Indicates a poorly designed cost accounting system.
• Results when actual overhead costs are less than amounts applied to work in process.

15.Which of the following statements is true about activity-based costing?

• Direct materials and direct labor are applied to work-in-process based upon cost drivers.
• Many different activity bases are used in applying overhead.
• Only one activity should be used for a company.
• There can only be one cost driver.

16.In an activity-based costing system, manufacturing overhead costs are divided into separate:

• Activity bases.
• Indirect cost centers.
• Activity cost pools.
• Cost drivers.

17.A job order cost system would be suitable for which of the following

• A manufacturer of candy bars
• A manufacturer of laundry detergent
• A sailboat builder
• A sugar refinery

18.Process costing would be suitable for

• Kitchen remodeling
• Automobile repair
• Boat building
• Production of television sets

19.Process cost systems

• Are good when companies produce homogeneous units
• May have work-in-process accounts for each department.
• Use equivalent units of production
• All of the above.

20.Equivalent units of production are

• A measure representing the percentage of a unit's cost that has been completed.
• May be computed separately for each input added during production
• May be assigned to beginning work-in-process or ending work-in-process
• All of the above