JOB ORDER COSTING
MULTIPLE CHOICE
1. Which of the following organizations would be most likely to use a job-order costing system?
a.the loan department of a bank
b.the check clearing department of a bank
c.A manufacturer of processed cheese food
d.A manufacturer of video cassette tapes
ANS: A
2. When job-order costing is used, the primary focal point of cost accumulation is the
a.department.
b.supervisor.
c.item.
d.job.
ANS: D
3. In a job-order costing system,
a.standards cannot be used.
b.an average cost per unit within a job cannot be computed.
c.costs are accumulated by departments and averaged among all jobs.
d.overhead is typically assigned to jobs on the basis of some cost driver.
ANS: D
4. What is the best cost accumulation procedure to use when many batches, each differing as to
product specifications, are produced?
a.job-order
b.process
c.actual
d.standard
ANS: A
5. Which of the following could not be used in job-order costing?
a.Standards
b.an average cost per unit for all jobs
c.normal costing
d.overhead allocation based on the job's direct labor hours
ANS: B
6. Which of the following costing systems allows management to quickly recognize materials,
labor, and overhead variances and take measures to correct them?
JOB ORDER COSTING
TRUE/FALSE
1.A company that produces sugar will use a job order costing system to track production
costs.
ANS:F
2.A company that produces sugar will use a process costing system to track production
costs.
ANS:T
3.A company that manufactures custom bridal gowns will use a job order costing system to
track production costs
ANS:T
4.A company that manufactures custom bridal gowns will use a process costing system to
track costs.
ANS:F
5.A company that manufactures small quantities of identifiable products will use a job
order costing system
ANS:T
6.A company that manufactures small quantities of identifiable products will use a process
costing system
ANS:F
7.A company that manufactures large quantities of homogenous goods will use a process
costing system.
ANS:T
8.In an actual job order costing system, factory overhead is assigned to a job on a periodic
basis.
ANS:T
9.A company that manufactures large quantities of homogenous goods will use a job order
costing system.
ANS:F
10.Cost flows and physical flows of units are identical.
ANS:F
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