ACCT 102 MIDTERM EXAM QUESTIONS
WITH 100% CORRECT ANSWERS
A company that uses a job order costing system would make the following entry to
record the flow of direct materials into production:
Multiple Choice
debit Work in Process Inventory, credit Raw Materials Inventory.
Correct
debit Factory Overhead, credit Raw Materials Inventory.
debit Work in Process Inventory, credit Factory Overhead.
debit Work in Process Inventory, credit Cost of Goods Sold.
debit Finished Goods Inventory, credit Raw Materials Inventory. - Answer-debit Work in
Process Inventory, credit Raw Materials Inventory.
Lowden Company has a predetermined overhead rate of 160% and allocates overhead
based on direct material cost. During the current period, direct labor cost is $50,000 and
direct materials cost is $80,000. How much overhead cost should Lowden Company
should apply in the current period?
Multiple Choice
$50,000.
$31,250.
$208,000.
$128,000.
$80,000. - Answer-$128,000.
If overhead applied is less than actual overhead incurred, it is:
Multiple Choice
Normal.
Overapplied.
Incorrect
Underapplied.
Correct
Expected.
Fully applied. - Answer-Underapplied.
Which of the following products is least likely to be produced in a process operation?
Multiple Choice
, Baseball caps
Calculators
Custom cabinets
Correct
Slacks for casual wear
Smartphones - Answer-Custom cabinets
Direct labor and indirect labor are recorded, respectively, to:
Multiple Choice
Work in Process Inventory and Factory Overhead.
Correct
Cost of Goods Sold and Finished Goods Inventory.
Finished Goods Inventory and Work in Process Inventory.
Work in Process Inventory and Finished Goods Inventory.
Factory Overhead and Work in Process Inventory. - Answer-Work in Process Inventory
and Factory Overhead.
A key idea in process costing that refers to the number of units that could have been
started and completed given the costs incurred during the period is known as:
Multiple Choice
Equivalent units of production.
Correct
Manufacturing overhead.
Process cost summary.
Units in process.
A job cost sheet. - Answer-Equivalent units of production.
The combined costs of direct labor and factory overhead per equivalent unit used by
many businesses with process operations is called:
Multiple Choice
Physical cost per equivalent unit
Overhead cost per equivalent unit
Finished cost per equivalent unit
Conversion cost per equivalent unit
Correct
Combined cost per equivalent unit - Answer-Conversion cost per equivalent unit
A hybrid costing system would be most appropriate when:
Multiple Choice
A manufacturer is able to standardize processes while at the same time attempting to
meet individual customer needs.
Correct
WITH 100% CORRECT ANSWERS
A company that uses a job order costing system would make the following entry to
record the flow of direct materials into production:
Multiple Choice
debit Work in Process Inventory, credit Raw Materials Inventory.
Correct
debit Factory Overhead, credit Raw Materials Inventory.
debit Work in Process Inventory, credit Factory Overhead.
debit Work in Process Inventory, credit Cost of Goods Sold.
debit Finished Goods Inventory, credit Raw Materials Inventory. - Answer-debit Work in
Process Inventory, credit Raw Materials Inventory.
Lowden Company has a predetermined overhead rate of 160% and allocates overhead
based on direct material cost. During the current period, direct labor cost is $50,000 and
direct materials cost is $80,000. How much overhead cost should Lowden Company
should apply in the current period?
Multiple Choice
$50,000.
$31,250.
$208,000.
$128,000.
$80,000. - Answer-$128,000.
If overhead applied is less than actual overhead incurred, it is:
Multiple Choice
Normal.
Overapplied.
Incorrect
Underapplied.
Correct
Expected.
Fully applied. - Answer-Underapplied.
Which of the following products is least likely to be produced in a process operation?
Multiple Choice
, Baseball caps
Calculators
Custom cabinets
Correct
Slacks for casual wear
Smartphones - Answer-Custom cabinets
Direct labor and indirect labor are recorded, respectively, to:
Multiple Choice
Work in Process Inventory and Factory Overhead.
Correct
Cost of Goods Sold and Finished Goods Inventory.
Finished Goods Inventory and Work in Process Inventory.
Work in Process Inventory and Finished Goods Inventory.
Factory Overhead and Work in Process Inventory. - Answer-Work in Process Inventory
and Factory Overhead.
A key idea in process costing that refers to the number of units that could have been
started and completed given the costs incurred during the period is known as:
Multiple Choice
Equivalent units of production.
Correct
Manufacturing overhead.
Process cost summary.
Units in process.
A job cost sheet. - Answer-Equivalent units of production.
The combined costs of direct labor and factory overhead per equivalent unit used by
many businesses with process operations is called:
Multiple Choice
Physical cost per equivalent unit
Overhead cost per equivalent unit
Finished cost per equivalent unit
Conversion cost per equivalent unit
Correct
Combined cost per equivalent unit - Answer-Conversion cost per equivalent unit
A hybrid costing system would be most appropriate when:
Multiple Choice
A manufacturer is able to standardize processes while at the same time attempting to
meet individual customer needs.
Correct
