Reference no: EM132534130

Question 1. Kay Kay Inc. establishes the following direct labor cost for one unit of product (D).

Standard hours 1.5 hours

Standard rate $20 per hour

Standard cost $30 (1.5 hours @ $20 per hour)

During the month of June $20,000 direct labor hours were worked and 12,500 units of product (D) were manufactured. Total wages related to direct labor in June were $405,000

What was the direct labor rate variance for June?

a. $30,000 Unfavorable

b. $5000 favorable

c. $5000 Unfavorable

d. $30,000 favorable

Question 2. Which of the following cost must be expensed under IAS2?

a. Cost of purchase that are paid to the suppliers of raw materials

b. Variable production overheads that are allocated to each unit based on the actual usage

c. Selling and distribution overheads incurred in the ordinary course of business

d. Import duties on the cost of raw materials that are paid to the authorities

Question 3. What is the correct journal entry under job order costing to dispose of an underapplied manufacturing overhead balance to the cost of goods sold account?

a. Manufacturing overhead (debit), Cost of goods sold (credit)

b. Cost of goods (debit), Work in progress (Credit)

c. Cost of goods (debit), Manufacturing overhead (Credit)

d. Manufacturing overhead (debit), Work in progress (Credit)

Question 4. Caribbean Company sold 100,000 gizoms at $12 each. Fixed Cost were $300,000 and net income was $200,000. What should have been reported as a variable expense in the CVP income statement?

a. $1,000,000

b. $700,000

c. $900,000

d. $500,000

Question 5. A company is selling a product called creamy pops for $5. The fixed costs for the manufactured company are $30,000, with variable cost $2 per unit. How many units should the company produce to break even?

a. 6000

b. 10,000

c. 15,000

d. 30,000

Question 6. Lewis Co. has fixed of $150,000 and variable cost of $9 per unit. If sales price per unit is $12, what is the break-even sales in dollars?

a. $200,000

b. $600,000

c. $480,000

d. $450,000

Question 7. In a job order costing system, raw material is assignment to a job when the materials are ______________.

a. Received from the materials vendor

b. Sold

c. Purchased

d. Issued by the materials stockroom

Question 8. In producing product ZZ, 14,800 direct labor hours were used at a rate of $8.20 per hour. The standard was 15,000 hours at $8.00 per hour, based on these data, the direct labor ____________

a. Efficiency variance of $3000 is favorable

b. Rate variance is $1600 favorable

c. Rate variance $2960 Unfavorable

d. Efficiency variance is $1600 Unfavorable