Fundamental Managerial Accounting Concepts
Questions with Correct Answers
A job-order costing system would be appropriate for - CORRECT ANSWER-services
provided by engineering firm
Which production system distributes costs evenly across total production? -
CORRECT ANSWER-process cost system
Job-order costing systems record transactions in inventory accounts on a(n)
__________ basis. (Enter only one word.) - CORRECT ANSWER-perpetual
A(n)___________ cost system maintains a separate work in process inventory
account for each department or processing center. (Enter only one word.) -
CORRECT ANSWER-process
Transferred-in costs are combined with additional materials, labor and costs
__________ incurred by each succeeding department. - CORRECT ANSWER-
overhead
What type of costing system accumulates costs by individual products? - CORRECT
ANSWER-Job-order
True or false: Process-costing systems allocate costs evenly to homogeneous
products. - CORRECT ANSWER-true
___________cost systems combine features of both process and job-order costing
systems. (Enter only one word.) - CORRECT ANSWER-Hybrid
True or false: The job-order cost system is patterned after the physical flow of
products as they move through the production process. - CORRECT ANSWER-true
Which type of cost system maintains a separate work in process inventory account
for each department? - CORRECT ANSWER-process cost system
A job cost sheet accumulates the - CORRECT ANSWER-product costs for each
individual job.
The costs transferred from one department to the next department are - CORRECT
ANSWER-transferred-in costs
A materials requisition form in a job-order cost system is used to - CORRECT
ANSWER-authorize the raw materials to be released from storage to production.
The work ticket provides space to record the - CORRECT ANSWER-employee
identification
job number
work description
, What type of costing system combines features of both process and job-order
costing systems? - CORRECT ANSWER-hybrid costing system
Paying cash to purchase raw materials decreases the asset cash and
__________the asset raw materials inventory. (Enter only one word.) - CORRECT
ANSWER-increases
Using $17,000 of raw materials in the production process is an - CORRECT
ANSWER-asset exchange transaction.
In a job-order costing system, product costs for each job are accumulated on a job
________ sheet. (Enter only one word.) - CORRECT ANSWER-cost
Sam Company paid $1,500 cash to purchase production supplies. This transaction is
an - CORRECT ANSWER-asset exchange transaction.
What source document lists the materials needed to begin work on a job? -
CORRECT ANSWER-materials requisition form
Sam Company paid $10,000 cash to production employees who worked on dog
house 103. The dog house is not finished. This transaction is an - CORRECT
ANSWER-asset exchange transaction
The source document used to record the amount of time spent by an employee on a
job is called the: - CORRECT ANSWER-work ticket
Edmonds Company engaged in the following transactions during May 2014: 1.
Purchased raw materials for cash, $400 2. Used raw materials to begin jobs, $284 3.
Paid wages of production employees, $180 4. Applied overhead at rate of $1.25 per
direct labor dollar What is the amount of applied overhead? - CORRECT ANSWER-
$225
$1.25 per direct labor dollar X $180 wages paid to production employees= $225
Bench Company paid $14,000 cash to purchase raw materials. What is the effect on
the financial statements? (Select all that apply.) - CORRECT ANSWER-Cash
decreases
Total assets are unchanged
Raw materials inventory increases
Sam company used $17,000 of raw materials in the production process. The
transaction will have the following effect: (Select all that apply.) - CORRECT
ANSWER-decrease raw materials inventory
total assets are unchanged
increase work in process inventory
Benchmore applied $6,500 of overhead to Job #1. What is the effect of this
transaction on the financial statements? - CORRECT ANSWER-No effect on total
assets
Questions with Correct Answers
A job-order costing system would be appropriate for - CORRECT ANSWER-services
provided by engineering firm
Which production system distributes costs evenly across total production? -
CORRECT ANSWER-process cost system
Job-order costing systems record transactions in inventory accounts on a(n)
__________ basis. (Enter only one word.) - CORRECT ANSWER-perpetual
A(n)___________ cost system maintains a separate work in process inventory
account for each department or processing center. (Enter only one word.) -
CORRECT ANSWER-process
Transferred-in costs are combined with additional materials, labor and costs
__________ incurred by each succeeding department. - CORRECT ANSWER-
overhead
What type of costing system accumulates costs by individual products? - CORRECT
ANSWER-Job-order
True or false: Process-costing systems allocate costs evenly to homogeneous
products. - CORRECT ANSWER-true
___________cost systems combine features of both process and job-order costing
systems. (Enter only one word.) - CORRECT ANSWER-Hybrid
True or false: The job-order cost system is patterned after the physical flow of
products as they move through the production process. - CORRECT ANSWER-true
Which type of cost system maintains a separate work in process inventory account
for each department? - CORRECT ANSWER-process cost system
A job cost sheet accumulates the - CORRECT ANSWER-product costs for each
individual job.
The costs transferred from one department to the next department are - CORRECT
ANSWER-transferred-in costs
A materials requisition form in a job-order cost system is used to - CORRECT
ANSWER-authorize the raw materials to be released from storage to production.
The work ticket provides space to record the - CORRECT ANSWER-employee
identification
job number
work description
, What type of costing system combines features of both process and job-order
costing systems? - CORRECT ANSWER-hybrid costing system
Paying cash to purchase raw materials decreases the asset cash and
__________the asset raw materials inventory. (Enter only one word.) - CORRECT
ANSWER-increases
Using $17,000 of raw materials in the production process is an - CORRECT
ANSWER-asset exchange transaction.
In a job-order costing system, product costs for each job are accumulated on a job
________ sheet. (Enter only one word.) - CORRECT ANSWER-cost
Sam Company paid $1,500 cash to purchase production supplies. This transaction is
an - CORRECT ANSWER-asset exchange transaction.
What source document lists the materials needed to begin work on a job? -
CORRECT ANSWER-materials requisition form
Sam Company paid $10,000 cash to production employees who worked on dog
house 103. The dog house is not finished. This transaction is an - CORRECT
ANSWER-asset exchange transaction
The source document used to record the amount of time spent by an employee on a
job is called the: - CORRECT ANSWER-work ticket
Edmonds Company engaged in the following transactions during May 2014: 1.
Purchased raw materials for cash, $400 2. Used raw materials to begin jobs, $284 3.
Paid wages of production employees, $180 4. Applied overhead at rate of $1.25 per
direct labor dollar What is the amount of applied overhead? - CORRECT ANSWER-
$225
$1.25 per direct labor dollar X $180 wages paid to production employees= $225
Bench Company paid $14,000 cash to purchase raw materials. What is the effect on
the financial statements? (Select all that apply.) - CORRECT ANSWER-Cash
decreases
Total assets are unchanged
Raw materials inventory increases
Sam company used $17,000 of raw materials in the production process. The
transaction will have the following effect: (Select all that apply.) - CORRECT
ANSWER-decrease raw materials inventory
total assets are unchanged
increase work in process inventory
Benchmore applied $6,500 of overhead to Job #1. What is the effect of this
transaction on the financial statements? - CORRECT ANSWER-No effect on total
assets
