Cost Accounting Exam and answers 1 2023 graded A+

A normal costing system uses costs for direct materials and direct labor, and: - Estimated costs for factory overhead Actual costing system - A costing process that uses actual costs incurred for direct materials, direct labor, and factory overhead All indirect manufacturing costs are commonly combined into a single cost pool called: - Overhead Any product, service, or organizational unit to which costs are assigned for some management purpose is a(n): - Cost Object Assume the following information pertaining to cub company: Prime costs = 195,000 Conversion costs = 221,000 Direct materials used = 85,000 Beginning work in process = 98,000 Ending work in process = 81,000 What is cost of goods manufactured? - (98,000+221,000+85,000)-81,0000 = 323,000 Average cost method - A method that uses units of output to allocate costs to products By-product costing - A by-product is a product of relatively small sales value that is produced simultaneously with one or more joint products. The two approaches are used for by-product costing: The asset recognition approach and the revenue approach. By-product costing that uses the asset recognition method(s) creates: - An inventory value in the period in which the by-products are produced Direct materials and direct labor costs total $40,000 and factory overhead costs total $100 per machine hour. If 200 machine hours were used for Job #202, what is the total manufacturing cost for Job #202? - (100*200) + 40,000 = 60,000 Direct method - Service department cost allocation accomplished by using the service flows only to production departments and determining each production department's share of that service FIFO method - A process costing method for calculating the current period's unit cost that includes only costs incurred and work performed during the current period Firm X has a production process that has a total joint cost of $15,000. At the split-off, there are 2,000 pounds of Product 1 and 3,000 pounds of Product 2. What is the cost per pound of Product 1 using the physical measure method? - $3.00 (6,000/2,000) Many firms use which one of the following terms to indicate the use of job costing in service industries? 1) Actual costing 2) Normal costing 3) Project costing 4) Industry costing 5) Standard costing - 3) Project costing Normal costing system - A costing process that uses actual costs for direct materials and direct labor and applies factory overhead to various jobs using a predetermined application rate Physical Measure Method - A method that uses a physical measures such pounds, gallons, or units of volume produced at the split-off point to allocate the joint costs to joint products Predetermined factory overhead rate - An estimated rate used to apply factory overhead cost to a cost object