HORNGRENS FINANCIAL AND MANAGERIAL
ACCOUNTING CERTIFICATION ASSESSMENT
2026 VERIFIED ANSWERS GRADED A+
◉ What were the total labor costs incurred by Smart Touch Learning
in 2026?
Answer: $197,000, with $169,000 as direct labor and $28,000 as
indirect labor.
◉ What are some actual overhead costs incurred by Smart Touch
Learning?
Answer: Depreciation: $20,000; Plant utilities: $7,000; Plant
insurance: $6,000; Property taxes: $5,000.
◉ What is a predetermined overhead allocation rate?
Answer: A rate used to allocate overhead costs to jobs before the end
of the period.
◉ What are common cost drivers in manufacturing?
Answer: Direct labor hours, direct labor costs, and machine hours.
◉ What were the estimated total overhead costs for Smart Touch
Learning in 2027?
,Answer: $68,000.
◉ What were the estimated total direct labor costs for Smart Touch
Learning in 2027?
Answer: $170,000.
◉ What is the significance of knowing unit costs for managers?
Answer: It helps in determining which products to produce and
setting profitable sales prices.
◉ How does a job differ from a process in costing systems?
Answer: A job is for unique products or services, while a process is
for identical units.
◉ What happens to indirect materials in the job order costing
system?
Answer: They are transferred from Raw Materials Inventory to
Work-in-Process through the Manufacturing Overhead account.
◉ What is the flow of product costs in job order costing?
Answer: Costs flow from materials purchased to materials used,
then to labor costs incurred, and finally to overhead costs allocated.
, ◉ What is the relationship between overhead costs and jobs in
manufacturing?
Answer: Overhead costs are allocated to jobs based on a
predetermined rate linked to an allocation base.
◉ What is the importance of calculating overhead allocation rates
before the period?
Answer: It allows managers to allocate costs to jobs accurately
before actual costs are known.
◉ What is the difference between direct and indirect labor?
Answer: Direct labor is directly involved in production, while
indirect labor supports production but is not directly tied to specific
jobs.
◉ What is the predetermined overhead allocation rate used by
Smart Touch Learning?
Answer: 40% of direct labor costs
◉ What was the total direct labor cost for Job 27?
Answer: $1,250
◉ How many tablets did Job 27 produce?
Answer: 15 tablets
ACCOUNTING CERTIFICATION ASSESSMENT
2026 VERIFIED ANSWERS GRADED A+
◉ What were the total labor costs incurred by Smart Touch Learning
in 2026?
Answer: $197,000, with $169,000 as direct labor and $28,000 as
indirect labor.
◉ What are some actual overhead costs incurred by Smart Touch
Learning?
Answer: Depreciation: $20,000; Plant utilities: $7,000; Plant
insurance: $6,000; Property taxes: $5,000.
◉ What is a predetermined overhead allocation rate?
Answer: A rate used to allocate overhead costs to jobs before the end
of the period.
◉ What are common cost drivers in manufacturing?
Answer: Direct labor hours, direct labor costs, and machine hours.
◉ What were the estimated total overhead costs for Smart Touch
Learning in 2027?
,Answer: $68,000.
◉ What were the estimated total direct labor costs for Smart Touch
Learning in 2027?
Answer: $170,000.
◉ What is the significance of knowing unit costs for managers?
Answer: It helps in determining which products to produce and
setting profitable sales prices.
◉ How does a job differ from a process in costing systems?
Answer: A job is for unique products or services, while a process is
for identical units.
◉ What happens to indirect materials in the job order costing
system?
Answer: They are transferred from Raw Materials Inventory to
Work-in-Process through the Manufacturing Overhead account.
◉ What is the flow of product costs in job order costing?
Answer: Costs flow from materials purchased to materials used,
then to labor costs incurred, and finally to overhead costs allocated.
, ◉ What is the relationship between overhead costs and jobs in
manufacturing?
Answer: Overhead costs are allocated to jobs based on a
predetermined rate linked to an allocation base.
◉ What is the importance of calculating overhead allocation rates
before the period?
Answer: It allows managers to allocate costs to jobs accurately
before actual costs are known.
◉ What is the difference between direct and indirect labor?
Answer: Direct labor is directly involved in production, while
indirect labor supports production but is not directly tied to specific
jobs.
◉ What is the predetermined overhead allocation rate used by
Smart Touch Learning?
Answer: 40% of direct labor costs
◉ What was the total direct labor cost for Job 27?
Answer: $1,250
◉ How many tablets did Job 27 produce?
Answer: 15 tablets
