Accounting 202 - Chapter 3.4

12 Questions | Total Attempts: 418

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Accounting 202 - Chapter 3.4 - Quiz

In today’s class we covered how to correct misallocations of overhead cost and journal entries in a manufacturing account. The test below is designed to test how well you understood out previous class and if you can make correct journal entries. Give it a try and all the best of luck!


Questions and Answers
  • 1. 
    If manufacturing overhead has been underallocated during the period, and most of the jobs produced have been sold, then:
    • A. 

      Cost of goods sold should be decreased

    • B. 

      Cost of goods sold should be increased

    • C. 

      Finished goods inventory should be increased

    • D. 

      Work in process inventory should be decreased

  • 2. 
    Determining how much manufacturing overhead is overallocated or underallocated is done:
    • A. 

      Before the period starts

    • B. 

      During the period

    • C. 

      At the end of the period

    • D. 

      At any time

  • 3. 
    Under what circumstance should the amount of overallocation or underallocation be reflected as an adjustment to cost of goods sold?
    • A. 

      In all circumstances

    • B. 

      If most of the inventory produced during the period has not been sold

    • C. 

      Under no circumstance

    • D. 

      If most of the inventory produced during the period has been sold

  • 4. 
    Cost of goods sold is debited and finished goods inventory is credited for
    • A. 

      Purchase of goods on account

    • B. 

      Transfer of goods to the finished goods storeroom

    • C. 

      The sale of goods to a customer

    • D. 

      Transfer of materials into work in process inventory

  • 5. 
    Finished goods inventory is debited and work in process inventory is credited for:
    • A. 

      Purchase of goods on account

    • B. 

      Transfer of goods to the finished goods storeroom

    • C. 

      Transfer goods out of the factory

    • D. 

      Transfer of material to work in process inventory

  • 6. 
    Raw materials inventory is credited and work in process inventory is debited when:
    • A. 

      Material is transferred to the factory

    • B. 

      We ship goods to the customer

    • C. 

      We transfer goods to the storeroom

    • D. 

      We purchase goods on account

  • 7. 
    The cost of direct labor used in production is recorded as a
    • A. 

      Debit to manufacturing overhead credit to wages expense

    • B. 

      Debit to work in process inventory credit to wages payable

    • C. 

      Debit to wages expense credit to manufacturing overhead

    • D. 

      Debit to wages payable credit to work in process inventory

  • 8. 
    The cost of direct materials used in production is recorded as a
    • A. 

      Debit to manufacturing overhead credit to direct materials expense.

    • B. 

      Debit to work in process inventory credit to raw materials inventory.

    • C. 

      Debit to raw materials inventory credit to work in process inventory.

    • D. 

      Debit to direct materials expense credit to manufacturing overhead.

  • 9. 
    The journal entry needed to record the receipt of a factory utility bill would include a:
    • A. 

      Credit to manufacturing overhead

    • B. 

      Debit to manufacturing overhead

    • C. 

      Debit to accounts payable

    • D. 

      Debit to utilities payable

  • 10. 
    The journal entry needed to record depreciation on the factory equipment would include a:
    • A. 

      Debit to manufacturing overhead credit to accumulated depreciation.

    • B. 

      Debit to work in process inventory credit to accumulated depreciation.

    • C. 

      Debit to depreciation expense credit to accumulated depreciation.

    • D. 

      Debit to accumulated depreciation credit to manufacturing overhead.

  • 11. 
    The journal entry needed to allocate manufacturing overhead to specific jobs would include a:
    • A. 

      Credit to manufacturing overhead

    • B. 

      Debit to manufacturing overhead

    • C. 

      Debit to cost of goods sold

    • D. 

      Credit to work in process inventory

  • 12. 
    The journal entry needed to record the receipt of a bill from the company's marketing agency would include a:
    • A. 

      Debit to manufacturing overhead

    • B. 

      Debit to marketing expense

    • C. 

      Debit to work in process inventory

    • D. 

      Credit to work in process inventory

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