Intangibility refers to thea. nonphysical nature of services as opposed to products.b. fact that production and consumption are inseparable for services.c. greater chances for variation in the performance of services than in the production ofproducts.d. fact that services cannot be inventoried but must be consumed when performed.
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Which of the following firms would make extensive use of service costing?a. auto manufacturerb. furniture manufacturerc. auto dealerd. CPA firm
Which of the following products would NOT use job-order costing?a. housesb. chemicalsc. shipsd. custom-built furniture
A source documenta. is only an external document.b. provides transaction data that can be recorded in a database.c. is only used to record a transaction between an organization and an outside vendor.d. is only an internal document.
Manufacturing overhead consists of alla. costs other than direct materials.b. manufacturing costs other than direct materials.c. costs other than direct materials and direct labor.d. manufacturing costs other than direct materials and direct labor.
Disadvantages of actual costing includea. actual cost systems cannot provide accurate unit cost information on a timely basis.b. actual cost systems produce unit costs that fluctuate from period to period.c. estimates must be used when calculating the actual overhead rate.d. both a and b.
7. The predetermined overhead rate is usually calculated at thea. end of each month.b. beginning of each month.c. beginning of the year.d. end of the year.
Unit cost information is needed fora. costing inventory.b. financial reporting requirements.c. decision making.d. all of these.
In developing unit costs, overhead costs should be assigned using activity drivers. Which would be the likelyactivity driver for a production process using a lathe?a. units producedb. direct labor hoursc. machine hoursd. direct materials cost
? is the absolute maximum production activity of a manufacturing firm.Expected activity levelb. Normal activity levelc. Theoretical activity leveld. Practical activity level
? is the maximum output that can be realized if everything operates efficiently.Expected activity levelb. Normal activity levelc. Theoretical activity leveld. Practical activity level
The ? serves as the document that identifies each job and accumulates its manufacturingcosts.a. job-order cost sheetb. control accountc. production orderd. bill of materials
A ? indicates the type and quantity of each material issued to the factory.a. control accountb. materials requisition formc. production listd. work ticket
If there is a debit balance in overhead control, that impliesa. actual overhead costs exceed overhead applied.b. applied overhead exceeds actual overhead.c. actual overhead has not been closed to cost of goods sold.d. none of these.