Job order costing

What is the best description of job costing?

• used when a product of one process becomes the material of another

• used to determine a break-even point

• used in areas such as hotels, transport and entertainment where an actual product is not made

• used when work consists of different products each time, made to meet customer's specific needs

Which company would most likely use job costing?

• Tax and audit firm

• Food company

• Chemical company

• Petroleum company

A job cost sheet includes:

• Direct materials, applied overhead, administrative costs.

• Direct materials, direct labor, applied overhead.

• Direct labor, actual overhead, selling costs.

• Direct materials, direct labor, operating costs.

The balance in the Work In Process Inventory at any point in time is equal to:

• The cost of jobs ordered but not yet started into production.

• The costs for jobs finished during the period but not yet sold.

• The sum of the costs for all jobs in process but not yet completed.

• materials, labor and overhead costs paid during the period.

A source document that production managers use to request materials for production and that is used to assign materials costs to specific jobs or to overhead is a:

• Materials Purchase Order

• Materials Requisition slip

• Time ticket

• Job Cost Sheet

Which of the following is not documented as job cost record?

• Direct material

• Direct labor

• Manufacturing Overhead

• depreciation

The rate established prior to the beginning of a period that uses estimated overhead and an allocation factor such as estimated direct labor cost, and that is used to assign overhead cost to jobs, is the:

• Predetermined Labor cost rate

• Predetermined Overhead rate

• Estimated labor cost rate

• Actual overhead rate

The request for the transfer of raw materials to the production floor is called ......

• product logistic

• product stock card

• materials requisition

• material gains

Job-order costing applies costs to specific jobs which may consist of a single unit or a few similar units.

• True

• False

A company is more likely to use a job order cost system if

• it manufactures a large volume of similar products

• its production is continuous

• it manufactures product with unique characteristics

• it uses a periodic inventory system