1. Which of the following is a characteristic of manufacturing overhead in a job order cost system?

A) It is indirectly traceable to specific jobs or units.

B) It includes the cost of all labor relating to manufacturing operations.

C) It is assigned to units produced by means of an overhead application rate.

D) It includes the cost of direct materials used and of indirect labor.

2. Manufacturing overhead is:

A) A direct cost that can traced to a specific job.

B) An indirect cost that can be traced to a specific job.

C) A direct cost that cannot be traced to a specific job.

D) An indirect cost that cannot be traced to a specific job.

3. If manufacturing overhead is materially overapplied, it is best to close it to:

A) Work-in-process inventory.

B) Finished goods inventory.

C) Cost of goods sold.

D) All three in an apportioned manner.

4. Conway Company uses a job order cost system and has established a predetermined overhead application rate for the current year of 150% of direct labor cost, based on budgeted overhead of $750,000 and budgeted direct labor cost of $500,000. Job no. 1 was charged with direct materials of $24,000 and with overhead of $18,000. The total cost of job no. 1:

A) Is $42,000.

B) Is $54,000.

C) Is $78,000.

D) Cannot be determined without additional information.

5. Gene's Metal Shop uses a job order cost system. It applies overhead to jobs at a rate of 150% of direct labor costs. Job No. 2617 required $600 in direct labor costs. The job was initially budgeted to require $650 in direct labor costs. Overhead applied to Job No. 2617 during the period amounted to:

A) $650.

B) $900.

C) $975.

D) Some other amount.

Answer rating: 100% (QA)

1 C It is assigned to units produced by me... View the full answer