2024 – A major purpose of cost accounting is to measure record and report product costs measure record and report period

Week 3 Practice Quiz : ACC 561 WileyPLUS Assignment – 2024

A major purpose of cost accounting is to

 

  • measure, record, and report product costs.
  • measure, record, and report period costs.
  • provide information to stockholders for investment decisions.
  • classify all costs as operating or nonoperating.

 

The two basic types of cost accounting systems are

 

  • job order and process cost systems.
  • process cost and batch systems.
  • job order and batch systems.
  • job order and job accumulation systems.

 

A process cost system would most likely be used by a company that makes

 

  • college graduation announcements.
  • motion pictures.
  • repairs to automobiles.
  • breakfast cereal.

 

Which of the following would be accounted for using a job order cost system?

 

  • The production of personal computers.
  • The production of automobiles.
  • The construction of a new campus building.
  • The refining of petroleum.

 

The flow of costs in a job order cost system

 

  • cannot be measured until all jobs are complete.
  • generally follows a LIFO cost flow assumption.
  • involves accumulating manufacturing costs incurred and assigning the accumulated costs to work done.
  • measures product costs for a set time period.

 

The entry to record the acquisition of raw materials on account is

 

  • Raw Materials Inventory
  • Accounts Payable
  •  Work in Process Inventory
  • Accounts Payable
  •  Manufacturing Overhead
  • Raw Materials Inventory
  • Accounts Payable
  • Accounts Payable
  • Raw Materials Inventory

 

Time tickets should be approved by

 

  • the employee’s supervisor.
  • the audit committee.
  • the payroll department.
  • co-workers.

 

The labor costs that have been identified as indirect labor should be charged to 

 

  • the individual jobs worked on.
  • direct labor.
  • salary expense.
  • manufacturing overhead.

 

Manufacturing overhead is applied to each job

 

  • by means of a predetermined overhead rate.
  • at the time when the overhead cost is incurred.
  • only if the overhead costs can be directly traced to that job.
  • at the end of the year when actual costs are known.

 

A process cost accounting system is most appropriate when

 

  • similar products are mass-produced.
  • a variety of different products are produced, each one requiring different types of materials, labor, and overhead.
  • individual products are custom made to the specification of customers.
  • the focus of attention is on a particular job or order.

 

Which of these best reflects a distinguishing factor between a job order cost system and a process cost system?

 

  • The manufacturing cost elements included.
  • The time period each covers.
  • The number of work in process accounts.
  • The detail at which costs are calculated.

 

In process cost accounting, manufacturing costs are summarized on a

 

  • process order cost sheet.
  • manufacturing cost sheet.
  • production cost report.
  • job order cost sheet.

 

In a process cost system, product costs are summarized:

 

  • on production cost reports.
  • when the products are sold.
  • on job cost sheets.
  • after each unit is produced.

 

Which of the following is considered a difference between a job order cost and a process cost system?

 

  • The manufacturing cost elements.
  • Documents used to track costs.
  • The accumulation of the costs of materials, labor, and overhead.
  • The flow of costs.

 

The costs that are easiest to trace directly to products are

 

  • A.direct materials and direct labor.
  • B.direct labor and overhead.
  • C.direct materials and overhead.
  • D.None of the above; all three costs are equally easy to trace to the product.

 

Often the most difficult part of computing accurate unit costs is determining the proper amount of _________ to assign to each product, service, or job.

 

  • direct materials and direct labor
  • direct labor
  • overhead
  • direct materials

 

The last step in activity-based costing is to

 

  • compute the activity-based overhead rate per cost driver.
  • identify and classify the major activities involved in the manufacture of specific products.
  • identify the cost driver that has a strong correlation to the activity cost pool.
  • assign manufacturing overhead costs for each activity cost pool to products.

 

The first step in activity-based costing is to

 

  • identify and classify the major activities involved in the manufacture of specific products.
  • assign manufacturing overhead costs for each activity cost pool to products.
  • identify the cost driver that has a strong correlation to the activity cost pool.
  • compute the activity-based overhead rate per cost driver.

 

A well-designed activity-based costing system starts with

 

  • analyzing the activities performed to manufacture a product.
  • assigning manufacturing overhead costs for each activity cost pool to products.
  • identifying the activity-cost pools.
  • computing the activity-based overhead rate.

 

An example of an activity cost pool is

 

  • number of inspections.
  • setting up machines.
  • machine hours.
  • number of setups.

 

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