Chapter 14 - True/false quiz
1. | Cost accounting is primarily concerned with accumulating information about product costs. |
2. | A job order cost system is most appropriate when a large volume of uniform products are produced. |
3. | A process cost accounting system is appropriate for homogeneous products that are continuously mass produced. |
4. | Raw Materials Inventory, Factory Labour, and Manufacturing Overhead are all control accounts in the general ledger when a job order cost accounting system is used. |
5. | The Purchases account is credited for all raw materials purchase returns and allowances |
6. | Job order cost sheets constitute the subsidiary ledger of the control account Work In Process Inventory |
7. | Actual manufacturing overhead costs should be charged to the Work in Process Inventory account as they are incurred. |
8. | In a process cost system, materials, labour and overhead are only added in the first production department |
9. | There are no units in process at the beginning of the period, 1,000 units in process at the end of the period that are 40% complete, and 5,000 units transferred out during the period. Based on this information, there were 4,600 equivalent units of production during the period. |
10. | A cost driver does not generally have a direct cause-effect relationship with the resources consumed. |
1.Cost accounting is primarily concerned with accumulating information about product costs.15 - 4
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Reporting2.A job order cost system is most appropriate when a large volume of uniform products areproduced.Cost Management
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3.A process cost accounting system is appropriate for similar products that are continuouslymass produced.Cost Management
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4.The perpetual inventory method cannot be used in a job order cost system.Cost Management
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5.A job order cost system and a process cost system are two alternative methods forvaluing inventories.
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Cost Management6.A job order cost system identifies costs with a particular job rather than with a set timeperiod.
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Cost Management7.A company may use either a job order cost system or a process cost system, but not both.
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Cost Management8.Raw Materials Inventory, Factory Labor, and Manufacturing Overhead are all controlaccounts in the general ledger when a job order cost accounting system is used.Cost Management
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9.Accumulating and assigning manufacturing costs are two important activities in a job ordercost system.Cost Management
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