Service versus Manufacturing Firms (LO 5-1)
Four areas in which services differ from products.
What are intangibility, inseparability, heterogeneity, and perishability?
This is the recognition and recording of costs and typically relies on a source document to describe the transaction.
What is cost accumulation?
This document is used to identify the cost of direct labor for a job.
What is a time ticket?
Job 52 had a beginning balance of $620. Materials requisitioned were $4,900 and direct labor cost was $2,500. Overhead is applied at 60% of direct labor cost.
Job 52 was completed and sold at 125 percent of cost.
The overhead applied to Job 52 is this.
What is $1,500?
Assume for the following information that materials are added at the beginning of the process.
Units in process, Dec. 1, 70% complete:15,000
Units completed and transferred out: 90,000
Units in process, Dec. 31, 40% complete: 30,000
The units started and completed is this.
What is 75,000?
These types of companies typically rank lower in customer satisfaction ratings.
What are service companies?
This is the association of production costs with the units produced.
What is cost assignment?
A document used to identify the cost of raw materials assigned to each job.
What is a materials requisition form?
Job 52 had a beginning balance of $620. Materials requisitioned were $4,900 and direct labor cost was $2,500. Overhead is applied at 60% of direct labor cost.
Job 52 was completed and sold at 125 percent of cost.
The total cost of Job 52 is this.
What is $9,520?
Assume for the following information that materials are added at the beginning of the process.
Units in process, Dec. 1, 70% complete:15,000
Units completed and transferred out: 90,000
Units in process, Dec. 31, 40% complete: 30,000
The equivalent units for direct materials and conversion costs of the units in ending work in process is this.
What is 30,000 for direct materials and 12,000 for conversion costs?
The fact that customers may perceive greater risk when buying services compared to buying products emphasizes the importance of this.
What are ethics?
This is the output that can be realized if everything operates perfectly.
What is the theoretical activity level?
The document that identifies each job and accumulates its manufacturing costs.
What is a job-order cost sheet?
Job 52 had a beginning balance of $620. Materials requisitioned were $4,900 and direct labor cost was $2,500. Overhead is applied at 60% of direct labor cost.
Job 52 was completed and sold at 125 percent of cost.
The selling price of Job 52 is this.
What is $11,900?
Assume for the following information that materials are added at the beginning of the process.
Units in process, Dec. 1, 70% complete:15,000
Units completed and transferred out: 90,000
Units in process, Dec. 31, 40% complete: 30,000
The equivalent units for direct materials and conversion costs of the units in beginning work in process is this.
What is 0 for direct materials and 4,500 units for conversion costs?
A company that makes identical units of the same product would be said to provide this type of product.
What is a standardized product?
Four activity levels that can be used when determining the applied overhead rate.
What are expected, normal, theoretical, and practical activity levels?
The collection of all job cost sheets.
What is the work-in-process inventory file?
Job 52 had a beginning balance of $620. Materials requisitioned were $4,900 and direct labor cost was $2,500. Overhead is applied at 60% of direct labor cost.
Job 52 was completed and sold at 125 percent of cost.
The gross margin of Job 52 is this.
What is $2,380?
Assume for the following information that materials are added at the beginning of the process.
Units in process, Dec. 1, 70% complete:15,000
Units completed and transferred out: 90,000
Units in process, Dec. 31, 40% complete: 30,000
The units started is this.
What is 105,000?
The uniqueness of products for cost accounting purposes relates to these.
What are unique costs?
This involves determining the dollar amounts of direct materials, direct labor, and overhead used in production and can also be referred to as classification of costs.
What is cost measurement?
A cost accumulation method that accumulates manufacturing costs by job.
What is a job-order costing system?
Job 52 had a beginning balance of $620. Materials requisitioned were $4,900 and direct labor cost was $2,500. Overhead is applied at 60% of direct labor cost.
Job 52 was completed and sold at 125 percent of cost.
If overhead is applied at 80% of direct labor cost, the amount of overhead applied to Job 52 is this.
What is $2,000?
This method excludes the equivalent units and manufacturing costs in beginning work in process from the current-period unit cost calculation.
What is the FIFO costing method?