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A2 > section 12 > Flashcards

section 12 Flashcards

1
Q

Keys to competitive management accounting

A

evolution
competitive edge
proprietary

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2
Q

What does it mean when there is a DEBIT balance in Manufacturing Overhead?

A

we had more actual overhead costs than were applied to WIP

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3
Q

a DEBIT balance in Manufacturing Overhead at the end of a period is a representation of

A

an UNDER-application of overhead to WIP

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4
Q

the Journal entry to adjust a debit balance in Manufacturing Overhead is

A

a CREDIT to Manufacturing Overhead
and
a DEBIT to COGS

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5
Q

a CREDIT balance in Manufacturing Overhead at the end of a period is a representation of

A

Overestimation of applications to WIP

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6
Q

The journal entry for the end of period adjustment of manufacturing overhead that has a CREDIT balance is

A

a DEBIT to Manufacturing Overhead
and
a CREDIT to COGS

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7
Q

In a job order cost system, the journal entry to record the incurring of direct labor costs would include a DEBIT? or CREDIT? to

A

debit to WIP Inventory

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8
Q

indirect material costs are transferred out of…..to….

A

raw materials inventory
manufacturing overhead

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9
Q

manufacturing overhead is what kind of account?

A

a holding account until it is determined how those costs are going to be applied to WIP inventory

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10
Q

Manufacturing Overhead consists of what kinds of costs?

A

indirect material costs
indirect labor costs
other overhead costs

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11
Q

what is indirect labor?

A

those who facilitate, supervise or compliment the manufacturing process

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12
Q

what is other mfg. overhead

A

rent, utilities, depreciation, taxes, insurance

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13
Q

when does manufacturing overhead transfer to WIP?

A

when it is designated job by job based on a predetermined rate

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14
Q

what are the costs in WIP

A

direct material costs
manufacturing overhead
direct labor

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15
Q

a job cost record also serves as a

A

WIP and FGI subsidiary ledger

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16
Q

in a job order cost system, how are direct material costs determined for each separate manufacturing job?

A

materials requisition forms noting the
AMOUNT
and
COST
of raw materials released to each job

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17
Q

in a job order cost system, how are direct labor costs typically determined for each separate job?

A

employee time cards noting the # of hrs direct laborers worked on each specific job

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18
Q

in a job order cost system, how are overhead costs typically determined for each separate manufacturing job?

A

overhead costs are applied on an estimated basis using a predetermined overhead rate
(direct labor hrs, material costs, machine hrs)
that is measured for each specific job

19
Q

In a manufacturing overhead account, projected costs are recorded as

A

credits

20
Q

in a manufacturing overhead account, actual costs in excess of projected WIP are closed to

A

COGS

21
Q

When Manufacturing Overhead has a debit balance, WIP has been

A

under applied because the actual overhead exceeded the projected amount previously added to WIP

22
Q

the general ledger total of WIP inventory should equal

A

the sum of all the job cost records (subsidiary ledger)

23
Q

When there’s a debit to WIP, there must also be an update to

A

the job cost record (subsidiary ledger)

24
Q

what kind of account is manufacturing overhead?

A

a holding or clearing account for accumulated overhead costs that will be allocated to WIP

25
Q

examples of other manufacturing overhead costs
what are the corresponding debits/credits

A

production supervisor’s salary—credit to salary payable
manufacturing utility costs—credit to cash
depreciation of manufacturing equipment—credit to accumulated depreciation

debit to MOC

26
Q

how are direct material costs determined for separate manufacturing jobs?

A

material requisition forms noting the amount and cost of raw materials released to each job

27
Q

how are direct labor costs determined for separate manufacturing jobs?

A

time cards noting the # of hours worked on each specific job

28
Q

how are manufacturing overhead costs determined for separate manufacturing jobs?

A

overhead is applied on an estimated basis using a predetermined overhead rate on some activity (direct labor hours, material costs, machine hours) that is measured for each specific job

29
Q

When MOC has a credit balance, applications to WIP have been

A

overapplied

30
Q

When applications to WIP are over applied, the adjustment of manufacturing overhead at year end is a debit to…and a credit to….

A

a debit to Manufacturing Overhead
and
a credit to COGS

31
Q

When applications to WIP have been under-applied, the adjustment of manufacturing overhead at year end is a debit to….. and a credit to….

A

a debit to COGS
and
a credit to Manufacturing Overhead

32
Q

T/F more goes in to the predetermined overhead rate calculation than just budgeted costs

A

true

33
Q

how is cost per unit determined in a process cost system?

A

total direct material, direct labor & MOC (for a period of time)
/
# of units produced during that period

34
Q

a job cost sheet includes what 3 categories?

A

Manufacturing Overhead Costs , Direct Labor , Direct Materials

35
Q

under application of MOC is a credit or debit balance?

A

debit balance

36
Q

MOC are closed to

A

COGS

37
Q

what are the 2 types of cost systems?

A

job order
process

38
Q

application to WIP are a debit or credit to MOC?

A

credit

39
Q

All of a company’s job cost records constitute a subsidiary ledger for their

A

WIP inventory account

40
Q

What is process costing?

A

a method that is commonly used by companies that manufacture large numbers of standardized products

41
Q

a MOC debit balance means that the actual costs

A

exceeded the applied predetermined MO rate

42
Q

a MOC credit balance means that actual costs

A

are less than applications to WIP

43
Q

T/F the predetermined overhead rate is solely based on budgeted costs

A

false, budgeted costs are not the only component of predetermined overhead rates

A2 (16 decks)

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