B3-M2 Cost Accounting 2

Question 1

How to calculate cost of jobs completed (or cost of goods manufactured)?

Answer 1

it equals DM used + DL + OH applied + beg. WIP - end. WIP

Question 2

what to compare when applying over/underapplied OH?

Answer 2

compare applied OH to actual OH. Overapplied is credit. Underapplied is debit

Question 3

what is process costing?

Answer 3

a method of allocating production costs to products and services by averaging the cost over the total units produced. costs are usually accumulated by department rather than by job

Question 4

what is job order costing?

Answer 4

a method of allocating production costs to products and services that are identifiable as separate units and require greater or lesser amounts of work to complete

Question 5

what is activity-based costing?

Answer 5

a system that accumulates all costs of overhead for each of the activities of the organization and then allocates those activity costs to the cost objects that caused the activity