ACC 560 Week 3 Quiz – Strayer NEW
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Week
3 Quiz 2: Chapter 2 and 3
Chapter
2
TRUE-FALSE
STATEMENTS
1. Cost accounting is primarily concerned with
accumulating information about product costs.
Ans:, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Industry/Sector Perspective, AICPA FN: Reporting, AICPA PC:
None, IMA: Reporting
2. A job order cost system is most appropriate
when a large volume of uniform products are produced.
Ans:, LO: 1, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Industry/Sector Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: Reporting
3. A process cost accounting system is
appropriate for similar products that are continuously mass produced.
Ans:, LO: 1, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Industry/Sector Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: Reporting
4. The perpetual inventory method cannot be
used in a job order cost system.
Ans:, LO: 1, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Industry/Sector Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: Reporting
5. A job order cost system and a process cost
system are two alternative methods for valuing inventories.
Ans:, LO: 1, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Industry/Sector Perspective, AICPA FN: Reporting, AICPA PC:
None, IMA: Reporting
6. A job order cost system identifies costs
with a particular job rather than with a set time period.
Ans:, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Industry/Sector Perspective, AICPA FN: Reporting, AICPA PC:
None, IMA: Reporting
7. A company may use either a job order cost
system or a process cost system, but not both.
Ans:, LO: 1, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Industry/Sector Perspective, AICPA FN: Reporting, AICPA PC:
None, IMA: Reporting
8. Raw Materials Inventory, Factory Labor, and
Manufacturing Overhead are all control accounts in the general ledger when a
job order cost accounting system is used.
Ans:, LO: 2, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Reporting, AICPA PC:
None, IMA: Reporting
9. Accumulating and assigning manufacturing
costs are two important activities in a job order cost system.
Ans:, LO: 2, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Industry/Sector Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: FSA
10. Recording the acquisition of raw materials
is a part of accumulating manufacturing costs.
Ans:, LO: 2, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: FSA
11. Manufacturing costs are generally incurred
in one period and recorded in a subsequent period.
Ans:, LO: 2, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: FSA
12. The Purchases account is credited for all
raw materials purchase returns and allowances.
Ans:, LO: 2, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: FSA
13. When raw materials are received, there is no effort at this point to associate the cost of
materials with specific jobs.
Ans:, LO: 2, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: FSA
14. When raw materials are purchased, the Work
in Process Inventory account is debited.
Ans:, LO: 2, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: FSA
15. Factory labor should be assigned to selling
and administrative expenses on a proportionate basis.
Ans:, LO: 2, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Reporting, AICPA PC:
None, IMA: Reporting
16. Fringe benefits and payroll taxes
associated with factory workers should be accumulated as a part of Factory
Labor.
Ans:, LO: 2, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: FSA
17. Job order cost sheets constitute the
subsidiary ledger of the control account Work In Process Inventory.
Ans:, LO: 3, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Industry/Sector Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: FSA
18. In a job order cost system, each entry to
the Work In Process Inventory account should be accompanied by a posting to one
or more job cost sheets.
Ans:, LO: 3, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: FSA
19. Direct materials requisitioned from the
storeroom should be charged to the Work In Process Inventory account and the
job cost sheets for the individual jobs on which the materials were used.
Ans:, LO: 3, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: FSA
20. Manufacturing overhead is the only product
cost that can be assigned to jobs as soon as the costs are incurred.
Ans:, LO: 3, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Reporting, AICPA PC:
None, IMA: Reporting
21. There should be a separate job cost sheet
for each job.
Ans:, LO: 3, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Industry/Sector Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: Business Economics
22. Actual manufacturing overhead costs are
assigned to each job by tracing each overhead cost to a specific job.
Ans:, LO: 4, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Reporting, AICPA PC:
None, IMA: FSA
23. The formula for the predetermined overhead
rate is estimated annual overhead costs divided by an expected annual operating
activity.
Ans:, LO: 4, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: Business Economics
24. Actual manufacturing overhead costs should
be charged to the Work in Process Inventory account as they are incurred.
Ans:, LO: 4, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Reporting, AICPA PC:
None, IMA: Reporting
25. A good system of internal control requires
that the job order cost sheet be destroyed as soon as the job is complete.
Ans:, LO: 5, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Industry/Sector Perspective, AICPA FN: Risk Management, AICPA
PC: None, IMA: Internal Controls
26. Finished Goods Inventory is charged for the
cost of jobs completed during a period.
Ans:, LO: 5, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: FSA
27. When goods are sold, the Cost of Goods Sold
account is debited and Work in Process Inventory account is credited.
Ans:, LO: 5, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Reporting, AICPA PC:
None, IMA: FSA
28. Total manufacturing costs for a period consists
of the costs of direct materials used, the cost of direct labor incurred, and
the manufacturing overhead applied during the period.
Ans:, LO: 5, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Reporting, AICPA PC:
None, IMA: Reporting
29. Overapplied overhead means that actual
manufacturing overhead costs were greater than the manufacturing overhead costs
applied to jobs.
Ans:, LO: 6, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: Business Economics
30. At the end of the year, the accountant
credits the amount of the overapplied overhead to Cost of Goods Sold.
Ans:, LO: 6, Bloom: C, Difficulty: Medium, Min: 1,
AACSB: None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Reporting, AICPA
PC: None, IMA: Reporting
31. A cost accounting
system consists of manufacturing cost accounts that are fully integrated into
the general ledger of a company.
Ans:, LO: 1, Bloom: C, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Industry/Sector Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: Business Economics
32. The cost of raw
materials purchased is credited to Raw Materials Inventory when materials are
received.
Ans:, LO: 2, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: FSA
33. Requisitions for direct
materials are posted daily to the individual job cost sheets.
Ans:, LO: 3, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Industry/Sector Perspective, AICPA FN: None, AICPA PC: None,
IMA: Business Economics
34. The predetermined
overhead rate is based on the relationship between estimated annual overhead
costs and expected annual operating activity expressed in terms of a common
activity base.
Ans:, LO: 4, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: Business Economics
35. At the end of the year,
underapplied overhead is usually credited to Cost of Goods Sold.
Ans:, LO: 6, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Reporting, AICPA PC:
None, IMA: Reporting
MULTIPLE
CHOICE QUESTIONS
36. Which of the following
is one of the components of cost accounting?
a. It involves measuring product costs.
b. It involves the determination of company
profits.
c. It requires GAAP to be applied.
d. It requires cost minimizing principles.
Ans:, LO: 1, Bloom: K, Difficulty: Easy, Min: 1, AACSB:
None, AICPA BB: Industry/Sector Perspective, AICPA FN: Measurement, AICPA PC:
None, IMA: Business Economics
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