ACCOUNTING 201 TEST QUESTIONS
WITH ANSWERS
Which of the following is a variable cost of a bicycle manufacturer
A) Insurance
B) Tires
C) Depreciation
D) Rent - Answer-B
Which of the following would not be a direct material for the Dole Food Company?
A) Pineapple
B) Stainless steel pots
C) Sugar
D) Glass Jars - Answer-B
Which of the following documents is used to release direct materials from the storeroom
to the factory?
A) Application Sheet
B) Materials requisition sheet
C) Bill of materials
D) Job cost sheet - Answer-B
Fabric used in the manufacture of baseball jerseys is an example of
A) Direct materials: No & Product cost: No
B) Direct Material: Yes & Product cost: No
C) Direct Material: Yes & Product cost: Yes
D) Direct Material: No & Product cost: Yes - Answer-C
At the beginning of the year, managers at King industries estimated $420,000 in
manufacturing overhead, 20,000 direct labor hours and 50,000 machine hours. Actual
manufacturing costs at the end of the year were 425,000 in manufacturing overhead.
During the year 22,000 direct labor hours and 47,000 machine hours were incurred. If
the overhead is applied based on direct labor hours, what is the predetermined
overhead rate for the coming year?
A) 20.00 per direct labor hour
B) 21.25 per direct labor hour
C) 19.09 per direct labor hour
D) 21.00 per direct labor hour - Answer-D
POHR= 420,000/20,000= 21
, At the beginning of the year, managers at King industries estimated $400,000 in
manufacturing overhead, 20,000 direct labor hours and 50,000 machine hours. Actual
manufacturing costs at the end of the year were 425,000 in manufacturing overhead.
During the year 22,000 direct labor hours and 47,000 machine hours were incurred. If
the overhead is applied based on direct labor hours, how much overhead was applied
during the year?
A) 399,960
B) 467,500
C) 440,000
D) 425,040 - Answer-C
POHR= 400,000/20,000= 20,000
$20 for every direct labor hour
20 x 22,000= 440,000
During October, Dorinirl Corporation incurred $60,000 of direct labor costs and $5,000
of indirect labor costs. The journal entry to record the accrual of these wages would
include a:
A) credit to Work in Process of $60,000
B) credit to Work in Process of $65,000
C) debit to Work in Process of $65,000
D) debit to Work in Process of $60,000 - Answer-D
Harris Fabrics computes its predetermined overhead rate annually on the basis of direct
labor-hours. At the beginning of the year, it estimated that 41,000 direct labor-hours
would be required for the period's estimated level of production. The company also
estimated $528,000 of fixed manufacturing overhead expenses for the coming period
and variable manufacturing overhead of $4.00 per direct labor-hour. Harris's actual
manufacturing overhead for the year was $764,764 and its actual total direct labor was
41,500 hours. - Answer-Estimated fixed manufacturing overhead $ 528,000
Estimated variable manufacturing overhead:
$4.00 per DLH × 41,000 DLHs = 164,000
528,000+164,000 = 692,000
Estimated total manufacturing overhead cost $ 692,000
The predetermined overhead rate is computed as follows:
WITH ANSWERS
Which of the following is a variable cost of a bicycle manufacturer
A) Insurance
B) Tires
C) Depreciation
D) Rent - Answer-B
Which of the following would not be a direct material for the Dole Food Company?
A) Pineapple
B) Stainless steel pots
C) Sugar
D) Glass Jars - Answer-B
Which of the following documents is used to release direct materials from the storeroom
to the factory?
A) Application Sheet
B) Materials requisition sheet
C) Bill of materials
D) Job cost sheet - Answer-B
Fabric used in the manufacture of baseball jerseys is an example of
A) Direct materials: No & Product cost: No
B) Direct Material: Yes & Product cost: No
C) Direct Material: Yes & Product cost: Yes
D) Direct Material: No & Product cost: Yes - Answer-C
At the beginning of the year, managers at King industries estimated $420,000 in
manufacturing overhead, 20,000 direct labor hours and 50,000 machine hours. Actual
manufacturing costs at the end of the year were 425,000 in manufacturing overhead.
During the year 22,000 direct labor hours and 47,000 machine hours were incurred. If
the overhead is applied based on direct labor hours, what is the predetermined
overhead rate for the coming year?
A) 20.00 per direct labor hour
B) 21.25 per direct labor hour
C) 19.09 per direct labor hour
D) 21.00 per direct labor hour - Answer-D
POHR= 420,000/20,000= 21
, At the beginning of the year, managers at King industries estimated $400,000 in
manufacturing overhead, 20,000 direct labor hours and 50,000 machine hours. Actual
manufacturing costs at the end of the year were 425,000 in manufacturing overhead.
During the year 22,000 direct labor hours and 47,000 machine hours were incurred. If
the overhead is applied based on direct labor hours, how much overhead was applied
during the year?
A) 399,960
B) 467,500
C) 440,000
D) 425,040 - Answer-C
POHR= 400,000/20,000= 20,000
$20 for every direct labor hour
20 x 22,000= 440,000
During October, Dorinirl Corporation incurred $60,000 of direct labor costs and $5,000
of indirect labor costs. The journal entry to record the accrual of these wages would
include a:
A) credit to Work in Process of $60,000
B) credit to Work in Process of $65,000
C) debit to Work in Process of $65,000
D) debit to Work in Process of $60,000 - Answer-D
Harris Fabrics computes its predetermined overhead rate annually on the basis of direct
labor-hours. At the beginning of the year, it estimated that 41,000 direct labor-hours
would be required for the period's estimated level of production. The company also
estimated $528,000 of fixed manufacturing overhead expenses for the coming period
and variable manufacturing overhead of $4.00 per direct labor-hour. Harris's actual
manufacturing overhead for the year was $764,764 and its actual total direct labor was
41,500 hours. - Answer-Estimated fixed manufacturing overhead $ 528,000
Estimated variable manufacturing overhead:
$4.00 per DLH × 41,000 DLHs = 164,000
528,000+164,000 = 692,000
Estimated total manufacturing overhead cost $ 692,000
The predetermined overhead rate is computed as follows:
