CHAPTER 15 ACCT 202 Definition Flashcards

Cost accounting system

A system that records manufacturing costs.

Target cost

The expected selling price of a job minus its desired profit.

Process operation

Mass production in a continuous flow of steps.

Job order costing system

Measures the cost to produce a job.

Job order production

When a customized product is manufactured separately, it is referred to as

direct materials, direct labor and overhead

The three manufacturing costs include:

raw materials inventory, work in process inventory, finished goods inventory

Manufacturing costs flow in which order?

Customer’s signature when job is complete

What is Not included on a job cost sheet

Customer’s name and address
Direct materials cost
Direct labor cost
Overhead costs

All of the following are included on a job cost sheet

Receiving Reports, Materials Ledger Card, Requisitions, Job Cost Sheets

What is the chronological order of the material cost flows through the subsidiary records?

Raw Materials Inventory

What account is debited when materials are purchased on credit for later use in production?

Time Ticket

A (BLANK) is used to track each employee’s direct labor time.

Work in Process Inventory

What account is debited when direct labor is recorded for the month?

Estimated Overhead costs / Estimated Activity Base

Predetermined overhead rate

Balance Sheet

Finished goods inventory is reported on the:

Income Statement

The costs assigned to a job that has been sold is reported on the:

Factory overhead applied

Total manufacturing costs include direct materials, direct labor, plus:

Schedule of Cost of Goods Manufactured

The beginning and ending work in process inventory account balances are reported on the balance sheet as shown in the:

Overhead has been underapplied.

Bridge Builders Company examined its Factory Overhead account at the end of the year and discovered a debit balance. What does this indicate?

Credit to Cost of Goods Sold

Bridge Builders Company examined its Factory Overhead account at the end of the year and discovered a credit balance of $2,000. The journal entry to close this account includes which of the following?

Service firms do not have raw materials, but manufacturers do.

One of the main differences between service companies and manufacturers is that:

Gross Profit / Sales

How to calculate Gross profit ratio

Sales - Cost of goods sold

How to calculate Gross Profit

Overapplied overhead

Amount by which the overhead applied to production in a period using the predetermined overhead rate exceeds the actual overhead cost incurred in a period.

Underapplied overhead

Amount by which actual overhead cost incurred in a period exceeds the overhead applied to that period’s production using the predetermined overhead rate.

journal entry Direct labor used