Cost Accounting Test 1 Ch 1-4 Questions & Answers 2024/2025
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Cost Accounting
Institution
Cost Accounting
Cost Accounting Test 1 Ch 1-4 Questions & Answers 2024/2025
cost driver - ANSWERS- what is something that is driving this business
3 most common cost drivers - ANSWERS1. direct labor hours
2. machine hours
3. total direct labor cost
predetermined manufacturing overhead rate - ANSWERS...
Cost Accounting Test 1 Ch 1-4 Questions &
Answers 2024/2025
cost driver - ANSWERS- what is something that is driving this business
3 most common cost drivers - ANSWERS1. direct labor hours
2. machine hours
3. total direct labor cost
predetermined manufacturing overhead rate - ANSWERSestimated total annual MOH costs/
estimated cost driver
why use annual data? - ANSWERSit smooths out seasonal effects and provides a relative rate
- would see widely fluctuations if used semi-annually or quarterly
job costing - ANSWERSunique, custom products or small batches
ex: hospitals, advertising agencies
process costing - ANSWERSmass production, similar items
ex: refineries, cereal manufacturers
flow of inventory through a manufacturing system - ANSWERSRM--> WIP--> FG--> COGS
allocating MOH to INDIVIDUAL units - ANSWERSpredetermined MOH rate * ACTUAL amount of
allocation base used by the job
PMOHR - ANSWERSstands for predetermined manufacturing overhead rate
, job costing - examples - ANSWERSautomobile repair shop, custom furniture builder, movie production
studio
process costing- examples - ANSWERSchemical manufacturer, paint manufacturer
underallocated MOH - ANSWERS- undercosted
- not enoughto allocated to jobs
- too little expense
overallocated MOH - ANSWERS- overcosted
- too muchh allocated to jobs
- too much expense
2 solutions to under/over allocation of MOH - ANSWERS1. adjust cost of goods sold
2. prorate among COGS, WIP, and FG
anything indirect is journalized as... - ANSWERSMOH
anything direct is journalized as - ANSWERSWIP
requisitioned - ANSWERSdemand to use or supply of a written order or a formal demand
prorate - ANSWERSdivided based on another value
allocate - ANSWERSto distribute resources of duties for a particular purpose
cost pool - ANSWERSgrouping of individual costs, typically by department
manufacturing overhead - ANSWERSall costs that are not traced to a particular job
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