ACCT101 - Ch.2 Exam Questions With 100% Correct Answers

ACCT101 - Ch.2 Exam Questions With 100% Correct Answers 1) Which of the following is a reason why a job order costing system is appropriate for a custom 1) furniture manufacturer? A) Custom furniture manufacturers produce large quantities of similar products. B) The direct costs incurred for each job are the same, only indirect costs vary. C) The raw materials used have already been accounted for using process costing. D) The cost incurred for each job will differ as per the order specifications. - answerD) The cost incurred for each job will differ as per the order specifications. 2) Which of the following is the correct order of the four steps of tracking product costs? A) accumulate → assign → allocate → adjust B) adjust → allocate → accumulate → assign C) assign → accumulate → allocate → adjust D) allocate → adjust → accumulate → assign - answerA) accumulate → assign → allocate → adjust 3) A major purpose of a cost accounting system is to ________. A) assist creditors in determining whether to grant a loan B) compute the cost of goods sold for the income statement C) show investors a company is operating efficientlyD) classify all costs as operating or marketing costs - answerB) compute the cost of goods sold for the income statement 4) The entry to record the purchase of raw materials on account would include a ________. A) debit to the Work-in-Process Inventory account B) credit to the Raw Materials Inventory account C) credit to the Work-in-Process Inventory account D) debit to the Raw Materials Inventory account - answerD) debit to the Raw Materials Inventory account 5) Which of the following accounts would be debited in the journal entry to record the issuance of direct materials? A) Work-in-Process Inventory B) Finished Goods Inventory C) Cost of Goods Sold D) Raw Materials Inventory - answerA) Work-in-Process Inventory 7) The journal entry to issue $800 of direct materials and $60 of indirect materials to production involves debit(s) to the ________. A) Work-in-Process Inventory account for $800 and Manufacturing Overhead account for $60 B) Work-in-Process Inventory account for $860 C) Manufacturing Overhead account for $860 D) Work-in-Process Inventory account for $800 and Finished Goods Inventory account for $60 - answerA) Work-in-Process Inventory account for $800 and Manufacturing Overhead account for $60 6) The journal entry to issue indirect materials to production should include a debit to the ________. A) Work-in-Process Inventory account B) Finished Goods Inventory accountC) Raw Materials Inventory account D) Manufacturing Overhead account - answerD) Manufacturing Overhead account Adelphia Manufacturing issued $80,000 of direct materials and $8000 of indirect materials for 8) production. Which of the following journal entries would correctly record the transaction? Manufacturing Overhead 88,000 Raw Materials Inventory 88,000 Work-in-Process Inventory 88,000 Raw Materials Inventory