7.01-7.02 Cost Accounting

The Sweet Shop manufactures cookies for sale by the Girl Scouts. Joe, the company accountant, is preparing the month end financial statement and reports for the company. The Sweet Shop records applied (estimated) overhead to Job Cost Sheets as a percentage of Direct Labor Costs. The rate that the Sweet Shop uses is 85% and the direct labor costs from the Job Cost Sheets for the month of March totaled $150,000. Actual factory overhead was $126,000. What is the journal entry to record the applied factory overhead?

• Debit Work in Process for $126,000 and Credit Factory Overhead for $126,000

• Debit Factory Overhead for $126,000 and Credit Work in Process for $126,000

• Debit Work in Process for $127,500 and Credit Factory Overhead for $127,500

• Debit Factory Overhead for $127,500 and Credit Work in Process for $127,500

The King Clothier Company makes silk shirts for men and women. The plant manager estimates that Handy Helper will manufacture 15,000 units next year. If the applied Factory Overhead rate for King Clothier equals 80%; and if total factory overhead costs are estimated to be $400,000; what are the estimated direct labor costs?

• $380,000

• $500,000

• $620,000

• $680,000

The Jamison Corporation makes computers. Mary Wiggins is the accountant who completes the job cost sheets. Her pay is $17 per hour. How should Mary's pay be classified?

• Direct labor

• Direct materials

• Indirect labor

• Indirect materials

The Holland Table Corporation manufactures dining tables and chairs. During the manufacturing process, a Job Cost sheet is prepared. The cost sheet for 150 units of dining tables shows $10,500.00 for direct materials, $5,500 for direct labor, and $8,000 for factory overhead. What is the cost per unit?

• $160.00

• $70.00

• $90.00

• $120.00

The Blue Corporation manufactures denim blue jeans. Jo, the accountant, has received several invoices. Three of the invoices totaling $45,990 are for items that will be used in the manufacturing process. Two additional invoices totaling $55,885 are for items that will be repairing several pieces of manufacturing machinery. The terms of the invoices re 2/10, n30. What unit will Jo debit to the materials account?

• $45,990

• $55,885

• $101,875

• $101,875

Ben's Barbershop balance sheet contains no inventory account. How would this company be classified?

• Construction business

• Manufacturing business

• Merchandising business

• Service business

The Golf House manufactures custom golf shoes. Janet, the company accountant, is preparing the month end financial statement and reports for the company. The Golf House records applied (estimated) overhead to Job Cost Sheets as a percentage of Direct Labor Costs. The rate that the Golf House uses is 80% and the direct labor costs from the Job Cost Sheets for the month of March totaled $220,000. Actual factory overhead was $166,000. What is the journal entry to dispose of over applied Factory Overhead?

• Debit Work in Process for $10,000 and Credit Factory Overhead for $10,000

• Debit Factory Overhead for $10,000 and Credit Work in Process for $10,000.

• Debit Income Summary for $10,000 and Credit Factory Overhead for $10,000

• Debit Factory Overhead for $10,000 and Credit Income Summary for $10,000

The Coffee Cafe manufactures premium roast coffee. Daquesha, the company accountant, is preparing the month end financial statement and reports for the company. The Coffee Cafe records applied (estimated) overhead to Job Cost Sheets as a percentage of Direct Labor Costs. The rate that the Coffee Cafe uses is 70% and the direct labor costs from the Job Cost Sheets for the month of June totaled $205,000. Actual factory overhead was $145,000. What is the journal entry to record the applied factory overhead?

• Debit Work in Process for $145,000 and Credit Factory Overhead for $145,000

• Debit Factory Overhead for $145,000 and Credit Work in Process for $145,000.

• Debit Work in Process for $143,500 and Credit Factory Overhead for $143,500

• Debit Factory Overhead for $143,500 and Credit Work in Process for $143,500

The Solar Company manufactures solar panels for businesses. Solar's accountant, Andy, is preparing the month end reports and journal entries. He sees that during the month of September, Solar transferred $305,500 of completed solar panels to the appropriate account. What is the journal entry to record this transaction?

• Debit Finished Goods for $305,500 and Credit Work in Process for $305,500

• Debit Finished Goods for $305,500 and Credit Cost of Goods Sold for $305,500

• Debit Cost of Goods Sold for $305,500 and Credit Finished Goods for $305,500

• Debit Work in Process for $305,500 and Credit Finished Goods for $305,500

The Hambrick Company manufactures terry cloth towels. Jones' accountant, Alice is preparing the month end reports and journal entries. She sees that during the month of June, Jones Company transferred $112,000 of completed towels to the appropriate account. What is the journal entry to record this transaction?

• Debit Finished Goods for $112,000 and Credit Work in Process for $112,000

• Debit Finished Goods for $112,000 and Credit Cost of Goods Sold for $112,000

• Debit Cost of Goods Sold for $112,000 and Credit Finished Goods for $112,000

• Debit Cost of Goods Sold for $112,000 and Credit Finished Goods for $112,000