Craigmont Company’s direct materials costs are $5,000,000, its direct labor costs total $8,800,000, and its factory overhead costs total $6,800,000. Its prime costs total:
Use the following data to compute total factory overhead costs for the month.
Factory manager salaries
Corporate office salaries
Using the information below for Sundar Company; determine the cost of goods manufactured during the current year:
Direct materials used
Direct labor used
Beginning work in process
Ending work in process
Using the information below, compute the raw materials inventory turnover:
Raw Materials Used
Beginning Raw Materials Inventory
Ending Raw Materials Inventory
Which of the following statements is correct concerning the Days’ sales in raw materials inventory?
A measure of how long it takes raw materials to be used in production.
The ratio is not useful for a manufacturer.
Reveals how many times a company turns over its raw materials inventory in a period.
Most companies generally prefer a higher number of days’ sales in raw materials inventory.
Is calculated by taking the Raw materials used/Average raw materials inventory.
Managerial accounting information:
Is used mainly by external users.
Involves gathering information about costs for planning and control decisions.
Is generally the only accounting information available to managers.
Can be used for control purposes but not for planning purposes.
Has little to do with controlling costs.
Managerial accounting information can be forwarded to the managers of a company quickly since external auditors do not have to review it, and estimates and projections are acceptable.
Straight line depreciation, rent and manager salaries are examples of variable costs.
Direct costs are incurred for the benefit of more than one cost object.
Raw materials that become part of a product and are identified with specific units or batches of a product are called direct materials.
The cost of partially completed products is included in the balance of the Work in Process Inventory account.
Raw materials purchased plus beginning raw materials inventory equals the ending balance of raw materials inventory.
The balanced scorecard aids in continuous improvement by augmenting financial measures with information on the drivers or indicators of future financial performance.
Which of the following items is not a management concept that was created to improve companies’ performances?
GAAP constraints and guidelines.
Total quality management.
Which one of the following items is normally not a manufacturing cost?
General and administrative expenses.
Copy Center pays an average wage of $11 per hour to employees for printing and copying jobs, and allocates $17 of overhead for each employee hour worked. Materials are assigned to each job according to actual cost. If Job M-47 used $320 of materials and took 15 hours of labor to complete, what is the total cost that should be assigned to the job?
Job A3B was ordered by a customer on September 25. During the month of September, Jaycee Corporation requisitioned $3,100 of direct materials and used $4,600 of direct labor. The job was not finished by the end of the month, but needed an additional $3,600 of direct materials and additional direct labor of $7,100 to finish the job in October. The company applies overhead at the end of each month at a rate of 150% of the direct labor cost incurred. What is the total cost of the job when it is completed in October?
The Work in Process Inventory account for DG Manufacturing follows. Compute the cost of jobs completed and transferred to Finished Goods Inventory.
Work in Process Inventory
The cost of units transferred to finished goods is:
A company has an overhead application rate of 128% of direct labor costs. How much overhead would be allocated to a job if it required total labor costing $18,000?
A company that uses a job order costing system would make the following entry to record the flow of direct materials into production:
debit Work in Process Inventory, credit Cost of Goods Sold.
debit Work in Process Inventory, credit Raw Materials Inventory.
debit Work in Process Inventory, credit Factory Overhead.
debit Factory Overhead, credit Raw Materials Inventory.
debit Finished Goods Inventory, credit Raw Materials Inventory.
Materials requisitions and time tickets are cost accounting source documents.
Job order production systems would be appropriate for companies that produce custom homes, specialized equipment, and special computer systems.
A company that uses a cost accounting system normally has only two inventory accounts: Finished Goods Inventory and Work in Process Inventory.
Service firms, unlike manufacturing firms, should only use actual costs when determining a selling price for their services.
Andrew Industries purchased $165,000 of raw materials on account during the month of March. The beginning Raw Materials Inventory balance was $22,000, and the materials used to complete jobs during the month were $141,000 direct materials and $13,000 indirect materials. What is the ending Raw Materials Inventory balance for March?