Question : 8) Stewart Company’s actual manufacturing overhead $2,800,000.  Overhead allocated the : 1217189

 

8) Stewart Company’s actual manufacturing overhead is $2,800,000.  Overhead is allocated on the basis of direct labor hours.  The direct labor hours were 50,000 for the period.  What is the manufacturing overhead rate?

A) $47.00

B) $56.00

C) $75.00

D) None of the above are correct.

 

9) O’Reilly Enterprises manufactures digital video equipment. For each unit $2,950 of direct material is used and there is $2,000 of direct manufacturing labor at $20 per hour.  Manufacturing overhead is applied at $35 per direct manufacturing labor hour.  Calculate the cost of each unit.

A) $4,950

B) $9,950

C) $8,450

D) $11,950

 

10) An example of a numerator reason for calculating annual indirect-cost rates includes:

A) fewer production workdays in a month

B) payment of estimated taxes four times a year

C) higher snow-removal costs during the winter

D) Both B and C are correct.

11) In a job-costing system, a manufacturing firm typically uses an indirect-cost rate to estimate the ________ allocated to a job.

A) direct materials

B) direct labor

C) manufacturing overhead costs

D) total costs

 

12) A job-cost sheet details the:

A) direct materials purchased and paid

B) direct labor costs incurred

C) indirect labor costs incurred

D) actual indirect overhead costs incurred

 

13) A job-cost record uses information from:

A) a materials requisition record to record raw material purchases from suppliers

B) a receiving report that indicates the type and quantity of each item received in an order from a supplier

C) a labor-time card to record an employee’s wage rate and hours spent on a particular job

D) All of these answers are correct.

 

14) Costs that are subject to short-run fluctuations for given jobs are:

A) actual costs

B) budgeted direct costs

C) budgeted indirect costs

D) normal costs

15) Annual cost rates are preferred over actual cost rates for all of the following reasons EXCEPT:

A) budgeted costs allow managers to have cost information on a timely basis

B) budgeted costs may be subject to short-run fluctuations

C) budgeted indirect-cost rates are known prior to the inception of a new job

D) budgeted-cost rates can be used to allocate direct or indirect costs

 

16) Fixed costs remain constant at $400,000 per month. During high-output months variable costs are $320,000, and during low-output months variable costs are $80,000. What are the respective high and low indirect-cost rates if budgeted professional labor-hours are 16,000 for high-output months and 4,000 for low-output months?

A) $45.00 per hour; $120.00 per hour

B) $45.00 per hour; $45.00 per hour

C) $25.00 per hour; $20.00 per hour

D) $56.20 per hour; $120.00 per hour

 

17) Managers and accountants collect most of the cost information that goes into their systems through:

A) an information databank

B) computer programs

C) source documents

D) time surveys

 

 

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