8) Which of the following describes the
allocation base
for allocating manufacturing overhead costs?
A) The factor that reflects the relationship between goods produced and the amount of overhead costs incurred
B) The estimated base amount of manufacturing overhead costs in a year
C) The percentage used to allocate direct labor to work in process
D) The formula for allocating depreciation expense over the life on an asset
9) Which of the following correctly describes the term
cost driver?
A) The inflation rate which causes costs to rise
B) The initial purchase price of direct materials
C) The primary factor which is correlated with the amount of cost incurred to produce a product
D) The total material, labor, and overhead cost of a completed job
10) Which of the following would NOT be considered a manufacturing overhead cost?
A) Depreciation of plant equipment
B) Direct labor cost
C) Plant utilities costs
D) Indirect labor
11) Which of the following would NOT be considered a manufacturing overhead cost?
A) Insurance for the factory
B) Indirect labor cost
C) Property tax for the plant
D) Direct labor
12) Which of the following correctly describes the predetermined manufacturing overhead rate?
A) The rate for factory utilities costs
B) The rate of actual overhead costs per day
C) The rate used to allocate overhead to production
D) The rate of increase in factory costs
13) When calculating the predetermined manufacturing overhead rate, what is the correct basis of calculation?
A) Estimated overhead costs divided by the number of days in a year
B) Estimated amount of the cost driver divided by the estimated total overhead costs
C) Actual overhead costs of the prior year divided by the actual amount of the cost driver or allocation base
D) Estimated overhead costs divided by the estimated amount of the cost driver or allocation base
14) When is the predetermined manufacturing overhead rate for a given production year calculated?
A) At the end of the production year
B) Before the production year begins
C) After each job is completed
D) At the mid-point of the production year
15) Falstaff Products estimates manufacturing overhead costs for the coming year at $500,000. Falstaff will allocate based on machine hours. Falstaff estimates 8,000 machine hours for the coming year. What is the predetermined manufacturing overhead rate?
A) $62.50 per machine hour
B) $0.016 per machine hour
C) $32.00 per machine hour
D) $6.25 per machine hour
16) Gardner Machine Shop estimates manufacturing overhead costs for the coming year at $316,000. They will allocate based on direct labor hours. Gardner estimates 5,000 direct labor hours for the coming year. What is the predetermined manufacturing overhead rate?
A) $6.32 per direct labor hour
B) $0.016 per direct labor hour
C) $63.20 per direct labor hour
D) $16.00 per direct labor hour
17) Falstaff Products allocates manufacturing overhead with a rate of $62.50 per machine hour. Job number 300 was just completed. It used 12 machine hours. How much overhead was allocated to the job?
A) $625
B) $75
C) $750
D) $7,500