Chapter 2

Question 1

Labor costs that are easily traced to a job are called

Answer 1

Direct labor costs

Question 2

Manufacturing cost.
Indirect cost.
Includes materials and labor.

Answer 2

Manufacturing overhead.

Question 3

1. Cost of goods manufactured.
2. Total manufacturing costs
3. Add: Beginning work in process inventory.
4. Deduct: Ending work in process inventory

Schedule of costs of goods manufactured in order

Answer 3

1
3
4
2

Question 4

Fixed manufacturing costs.

Variable manufacturing costs.

Answer 4

Absorption costing.

Question 5

What is debated in the journal entry to record the purchase of materials?

Answer 5

Raw materials

Question 6

Manufacturing overhead is debited

Answer 6

Actual overhead is incurred

Question 7

Manufacturing overhead is credited

Answer 7

A job is completed

Question 8

Manufacturing overhead is closed

Answer 8

Period ends

Question 9

Which is credited in the journal entry to record labor costs.

Answer 9

Salaries and wages payable

Question 10

Factory utilities
Factory rent
Supervisor salary

Answer 10

Manufacturing overhead

Question 11

Jobs that are not easily traced

Answer 11

Manufacturing overhead

Question 12

Direct labor.
Direct materials.
Can they be easily traced?

Answer 12

Yes

Question 13

A factor that causes overhead costs to occur

Answer 13

Cost driver

Question 14

The schedule of cost of goods _____ summarizes the costs that remain in finished goods inventory and that have been transferred to cost of goods sold.

Answer 14

Sold

Question 15

Predetermined overhead rate= estimated manufacturing overhead / by

Answer 15

Estimated allocation base

Question 16

_____ consists of units that are partially complete

Answer 16

Work in process

Question 17

Process used to assign overhead costs to products is clef overhead _____

Answer 17

Allocation

Question 18

Debits manufacturing and credit accounts payable would be incurrence of rent on factory equipment and incurrence of factory utilities

Answer 18

True

Question 19

Raw materials inventory at the start of the year was 27000, and at the end 25000. During the year they purchased 100000 in raw materials, including 28000 of indirect material that were out in manufacturing overhead during the period. What is was the cost of direct materials during the period?

Answer 19

74000

Start+ purchased - indirect materials - ending inventor You= cost of direct materials.

27000+ 100000 - 28000- 25000= 74000

Question 20

Inventory that consist of completed units that haven’t been sold

Answer 20

Finished goods

Question 21

Administrative and selling costs are directly charged on the income statement

Answer 21

True

Question 22

Denis deprecation expense and credits accumulated depreciation

Answer 22

Deprecation on office equipment

Question 23

When a job is completed, it’s costs are transferred into

Answer 23

Finished goods