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KET201 Accounting Fertilizer Manufacturing Đại học Hà Nội

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KET201 Accounting Fertilizer Manufacturing Đại học Hà Nội

Chapter 4
COST SYSTEMS AND COST ACCUMULATION
MULTIPLE CHOICE
Question Nos. 7, 9, 12-14, and 16 are AICPA adapted.
Question Nos. 8, 10, 11, and 15 are CIA adapted.
E 1. The tie-in between general accounts and cost accounts is often discussed with
accounting procedures. An example of a general account is:
A. Materials
B. Work in Process
C. Factory Overhead Control
D. Finished Goods
E. Accumulated Depreciation
C 2. One feature of a standard cost system is that:
A. selection of the cost unit becomes simplified
B. predetermined amounts are ignored
C. an analysis of cost variances is facilitated
D. historical costs are recorded as they are incurred
E. reports are delayed until operations have been performed
A 3. An industry that would most likely use job order costing procedures is:
A. road building
B. fertilizer manufacturing
C. flour milling
D. petroleum refining
E. textile manufacturing
D 4. An industry that would most likely use process costing procedures is:
A. musical instrument manufacturing
B. construction
C. aircraft
D. chemicals
E. office equipment
A 5. Supplies needed for use in the factory are issued on the basis of:
A. materials requisitions
B. time tickets
C. factory overhead analysis sheets
D. clock cards
E. purchase invoices
Cost Systems and Cost Accumulation 33
D 6. Finished Goods is debited and Work in Process is credited for a:
A. transfer of materials to the factory
B. return of unused materials from the factory
C. purchase of goods on account
D. transfer of completed production
E. transfer of completed goods out of the factory
B 7. The best cost accumulation procedure to use when many batches, each differing
as to product specifications, are produced is:
A. absorption
B. job order
C. process
D. actual
E. standard
A 8. Job order costs are most useful for:
A. determining the cost of a specific project
B. determining the labor cost involved in production
C. determining inventory valuation using lifo
D. estimating overhead costs
E. controlling indirect costs of future production
E 9. Under a job order cost system, the dollar amount of the entry to transfer the
inventory from Finished Goods to Cost of Goods Sold is the sum of the costs
charged to all jobs:
A. completed during the period
B. started in process during the period
C. in process during the period
D. completed and sold during the period
E. sold during the period
A 10. The industry most likely to use job order costing in accounting for costs is:
A. accounting firms
B. textile manufacturer
C. paint manufacturer
D. oil refinery
E. none of the above
A 11. Job order cost accounting systems and process accounting systems differ in the
way:
A. costs are traced to cost objects
B. orders are taken and in the number of units in the orders
C. product profitability is determined and compared with planned costs
D. manufacturing processes can be accomplished and in the number of
production runs that may be performed in a year
E. none of the above
D 12. In a job order cost system, the distribution of direct labor costs usually are
recorded as an increase in:
A. Cost of Goods Sold
B. Factory Overhead Control
C. Finished Goods
D. Work in Process
E. none of the above
34 Chapter 4
C 13. Process costing techniques should be used in assigning costs to products:
A. if the product is manufactured on the basis of each order received
B. when production is only partially completed during the accounting period
C. if the product is composed of mass-produced homogeneous units
D. whenever standard costing techniques should not be used
E. none of the above
A 14. A characteristic of a process costing system is:
A. partially processed inventory is restated in terms of completed units
B. costs are accumulated by order
C. it is used by a company manufacturing custom machinery
D. standard costs are not applicable
E. none of the above
C 15. The industry most likely to use process costing in accounting for costs is:
A. road builder
B. electrical contractor
C. airlines
D. automobile repair shop
E. none of the above
B 16. In the computation of manufacturing cost per equivalent unit, the weighted
average method of process costing considers:
A. current costs only
B. current costs plus cost of beginning work in process inventory
C. current costs plus cost of ending work in process inventory
D. current costs less cost of beginning work in process inventory
E. none of the above
B 17. The element of manufacturing cost that supports time tickets is:
A. materials
B. labor
C. factory overhead
D. all of the above
E. none of the above
C 18. The element of manufacturing cost that supports depreciation schedules is:
A. materials
B. labor
C. factory overhead
D. all of the above
E. none of the above
D 19. Work in Process is debited and Materials is credited for:
A. indirect materials requisitioned to production
B. the completion of work in process
C. the sale of completed product
D. direct materials requisitioned to production
E. materials returned to the storeroom

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