Business Questions

1058 WordsNov 7, 20145 Pages
PRACTICE QUESTIONS SESSION 3 1. Which of the following statements is true? A. Service firms have little need for determining the cost of their services. B. The concept of product costing is relevant only for manufacturing firms. C. The cost of year-end inventory appears on the balance sheet as an expense. D. Service companies use cost information for planning and control purposes. E. Mining and petroleum companies have no inventoriable costs. 2. Which of the following manufacturers would most likely use job-order costing? A. Chemical manufacturers. B. Microchip processors. C. Custom-furniture manufacturers. D. Gasoline refiners. E. Fertilizer manufacturers. 3. A custom-home builder would likely utilize: A. job-order costing. B.…show more content…
On the basis of this information, the 20x1 predetermined overhead rate was: A. $0.04 per machine hour. B. $0.05 per machine hour. C. $20 per machine hour. D. $21 per machine hour. E. $25 per machine hour. 13. Dixie Company, which applies overhead at the rate of 190% of direct material cost, began work on job no. 101 during June. The job was completed in July and sold during August, having accumulated direct material and labor charges of $27,000 and $15,000, respectively. On the basis of this information, the total overhead applied to job no. 101 amounted to: A. $0. B. $28,500. C. $51,300. D. $70,500. E. $79,800. 14. Huxtable charges manufacturing overhead to products by using a predetermined application rate, computed on the basis of machine hours. The following data pertain to the current year: Budgeted manufacturing overhead: $480,000 Actual manufacturing overhead: $440,000 Budgeted machine hours: 20,000 Actual machine hours: 16,000 Overhead applied to production totaled: A. $352,000. B. $384,000. C. $550,000. D. $600,000. E. some other amount. 15. Simone uses a predetermined overhead application rate of $8 per direct labor hour. A review of the company's accounting records for the year just ended discovered the following: Underapplied manufacturing overhead: $7,200 Actual manufacturing overhead: $392,000 Budgeted labor hours: 50,000 Simone's actual labor hours worked totaled: A. 48,100. B. 49,100. C. 49,900. D. 50,900.
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