1) At the end of the year, manufacturing overhead has been overapplied. What occurred to create this situation? | | A. | | The company incurred more total job costs than the amount budgeted for the job. | | B. | | The actual manufacturing overhead costs were less than the manufacturing overhead assigned to jobs. | | C. | | Estimated manufacturing overhead was less than actual manufacturing overhead costs. | | D. | | The company incurred more manufacturing overhead costs than the manufacturing overhead assigned to jobs. | | | 2) Luca Company overapplied manufacturing overhead during 2006. Which one of the following is part of the year end entry to dispose of the overapplied amount assuming the amount is material? | | A. | | An increase to finished goods | | B. | | An increase to cost of goods sold | | C. | | A decrease to applied overhead | | D. | | A decrease to work in process inventory | | | 3) Why is factory overhead applied to products and jobs by manufacturing companies? | | A. | | Total actual overhead costs can never be accurately determined for production. | | B. | | It provides a more accurate cost of the job or products being processed. | | C. | | Because indirect costs are easy to trace to products and jobs. | | D. | | It allows managers more timely determination of product costs during the manufacturing process. | | | 4) In a job order cost accounting system, the Work in Process account is | | A. | | closed at year end | | B. | | a control account | | C. | | a period cost | | D. | | an expense | | | 5) Which one of the following is an important feature of a job order cost system? | | A. | | Each must be completed before a new product order is accepted. | | B. | | Each job uses similar processes to produce. | | C. | | Each consists of