AC 642 Module 1 Exam Prep with Questions and Answers

AC 642 Module 1 Exam Prep with Questions and Answers Assume Excellent Company is a job-order firm that follows a normal costing approach. Which of following statements reflect the correct approach of accounting for overheads? a.Overhead is assigned to production using indirect labor hours. b.Overhead is applied to each job using a predetermined rate. c.Actual overheads are assigned to jobs. d.Actual overheads incurred need not be accounted for. ANSWER Overhead is applied to each job using a predetermined rate Ruby Company is a job-order firm that follows a normal costing approach. Job 26 Job 27 Job 28 Beginning balance$ 500$ 0$ 0 Materials requisitioned$5,000$4,800$4,500 Direct labor cost$2,400$2,250$1,900 Applied overhead$1,800$1,560$1,320 Total cost$9,700$8,610$7,720 During January, Job 26 and Job 27 were completed, and Job 26 was sold at 125 percent of cost. Job 28 remains unfinished at the end of the month. Assuming the beginning balance of Finished Goods is $2,000 (consisting of Job 61), calculate the ending balance of Finished Goods for January. a.$9,720 b.$11,700 c.$10,610 d.$10,810 ANSWER $10,610 Ending balance of Finished Goods for January = Beginning balance of Finished Goods +