PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control

College of Management and Accountancy First Periodic Examination - Set A

Name: Date:
Block & Year: Student ID number:

General Direction: Choose the best answer. Shade your final answer on the separate answer sheet provided.
Erasures on the answer sheet are strictly prohibited.

Part I: Multiple Choice Questions

1. The Finished Goods Control account consists of actual manufacturing overhead costs rather than allocated manufacturing
overhead costs.
a. True
b. False
2. Indirect manufacturing costs are debited to Manufacturing Overhead Control.
a. True
b. False
3. Indirect materials that are requisitioned increase the Materials Control account.
a. True
b. False
4. Purchases of materials are credited to materials control.
a. True
b. False
5. Work-in-Process Control will be decreased (credited) for the amount of direct-labor costs incurred.
a. True
b. False
6. An industry that would most likely use job order costing procedures is:
a. fertilizer manufacturing
b. flour milling
c. petroleum refining
d. road building
e. textile manufacturing
7. When a job is complete:
a. Work-in-Process Control is debited
b. Finished Goods Control is credited
c. the cost of the job is transferred to Manufacturing Overhead Control
d. actual direct materials, actual direct manufacturing labor, and allocated manufacturing overhead will comprise the
total cost of the job
8. When spoilage occurs because of some internal failure, the unrecoverable cost should be charged to:
a. Work in Process
b. Spoiled Goods Inventory
c. Applied Factory Overhead
d. Factory Overhead Control
e. none of the above
9. Which of the following statements regarding manufacturing overhead allocation is FALSE?
a. It includes all manufacturing costs that cannot be directly traced to a product or service.
b. Total costs are unknown at the end of the accounting period.
c. The costs can be grouped in either a single indirect-cost pool or in multiple indirect-cost pools.
d. Allocated amounts are debited to Work-in-Process.
10. Costs that change in relation to volume changes, but not in direct proportion to those changes, are known as:
a. Variable costs.
b. Fixed costs.
c. Total costs.
d. Semivariable costs.

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PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control
College of Management and Accountancy First Periodic Examination - Set A

11. What would be the appropriate journal entry if the following labor wages were incurred in a furniture manufacturing
company?
Assembly workers P20,000
Janitors P10,000
a. Work-in-Process Control 30,000
Wages Payable Control 30,000
b. Manufacturing Overhead Control 30,000
Wages Payable Control 30,000
c. Wages Payable Control 30,000
Work-in-Process Control 30,000
d. Work-in-Process Control 20,000
Manufacturing Overhead Control 10,000
Wages Payable Control 30,000
12. When rework occurs because of some action taken by the customer, the cost of the rework should be charged to:
a. Spoiled Goods Inventory
b. Factory Overhead Control
c. Applied Factory Overhead
d. Work in Process
13. A company has been ordering more than the economic order quantity. This would result in:
a. more frequent order points
b. equal safety stock costs and carrying costs
c. carrying costs less than order costs
d. insufficient safety stock costs
e. carrying costs greater than order costs
14. What is the appropriate journal entry if direct materials of P20,000 and indirect materials of P3,000 are sent to the
manufacturing plant floor?
a. Work-in-Process Control 20,000
Materials Control 20,000
b. Work-in-Process Control 20,000
Manufacturing Overhead Control 3,000
Materials Control 23,000
c. Work-in-Process Control 23,000
Materials Control 23,000
d. Manufacturing Overhead Control 3,000
Materials Control 20,000
Work-in-Process Control 23,000
15. Under a job order system of cost accounting, the peso amount of the entry to transfer inventory from Work in Process to
Finished Goods is the sum of the costs charged to all jobs:
a. In process during the period.
b. Completed during the period.
c. Completed and sold during the period.
d. Started in process during the period.
16. Which of the following statements is correct?
I. Accumulating and assigning manufacturing costs are two important activities in a job order cost system.
II. Recording the acquisition of raw materials is a part of accumulating manufacturing costs.
a. Statement I only.
b. Statement II only.
c. Both statements are incorrect.
d. Both statements are correct
17. When 10,000 units are produced, fixed costs are P14 per unit. Therefore, when 20,000 units are produced fixed costs , the
total Fixed cost is:
a. increase to P28 per unit
b. remain at P14 per unit
c. increase to P7 per unit
d. decrease to P7 per unit

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PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control
College of Management and Accountancy First Periodic Examination - Set A

18. A cost driver is:

a. A basis used to allocate each of the activity cost pools.
b. An overhead or activity rate.
c. The estimated cost of each activity pool.
d. Used only to allocate non-volume-related costs.
19. Overapplied overhead will always result when a predetermined factory overhead rate is employed and:
a. Overhead incurred is less than overhead applied.
b. Overhead incurred is more than overhead applied.
c. Production is greater than sales.
d. Actual overhead costs are less than expected.
20. The ending balance in the Work-in-Process Control account represents the costs of all jobs that:
a. have been completed but not sold
b. have been completed and sold to customers
c. are reported on the income statement
d. have not been completed
21. Factory overhead includes:
a. Indirect labor but not indirect materials.
b. All manufacturing costs.
c. All manufacturing costs except direct materials and direct labor.
d. Indirect materials but not indirect labor.
22. Which of the following is not a cost that is accumulated in Work in process?
a. Direct materials
b. Direct labor
c. Factory overhead
d. Administrative expense
23. In the financial statements, Materials should be categorized as:
a. Revenue.
b. Expenses
c. Liabilities
d. Assets
24. Actual (rather than allocated) manufacturing overhead costs are included in the:
a. Work-in-Process Control account
b. Manufacturing Overhead Control account
c. Finished Goods Control account
d. Both A and B are correct.
25. Examples of service businesses include:
a. Department stores, poster shops, and wholesalers
b. Hair stylists, Airlines, and architects,
c. Aircraft producers, home builders, and machine tool makers.
d. None of these are correct.
26. When direct materials are requisitioned the ________ account is increased.
a. Manufacturing Overhead Control
b. Materials Control
c. Work-in-Process Control
d. Accounts Payable Control
27. In a normal costing system, the Manufacturing Overhead Control account:
a. is increased by allocated manufacturing overhead
b. is debited with actual overhead costs
c. is credited with amounts transferred to Work-in-Process
d. is decreased by allocated manufacturing overhead
28. All of the following are true of the Work-in-Process Control account EXCEPT that:
a. the balance equals the sum of amounts from all in-process individual job-cost records
b. it is an asset account
c. it tracks job costs from beginning through completion
d. it tracks all direct material purchases

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PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control
College of Management and Accountancy First Periodic Examination - Set A

29. Julius Pinauna is paid P10 an hour for straight-time and P15 an hour for overtime. One week she worked 42 hours, which
included 2 hours of overtime. Compensation would be reported as
a. P400 of direct labor and P30 of manufacturing overhead.
b. P420 of direct labor and P10 of manufacturing overhead.
c. P400 of direct labor and Pzero of manufacturing overhead.
d. P430 of direct labor and Pzero of manufacturing overhead
30. The business entity that purchases finished goods for resale is a:
a. Merchandiser.
b. Manufacturer.
c. Service business.
d. For-profit service business.
31. The business entity that converts purchased raw materials into finished goods by using labor, technology, and facilities is a:
a. Merchandiser.
b. Manufacturer.
c. Service business.
d. For-profit service business.
32. The Materials Control account is increased when:
a. direct materials are purchased
b. indirect materials are purchased
c. materials are requisitioned for production
d. Both A and B are correct.
33. Unit cost information is important for making all of the following marketing decisions except:
a. Determining the selling price of a product.
b. Bidding on contracts.
c. Determining the amount of profit that each product earns
d. Determining the amount of advertising needed to promote the product.
34. Cost accounting differs from financial accounting in that financial accounting:
a. Is mostly concerned with individual departments of the company.
b. Is mostly concerned with external financial reporting.
c. Provides the additional information required for special reports to management.
d. Puts more emphasis on future operations.
35. All of the following items are debited to Work-in-Process EXCEPT:
a. completed goods being transferred out of the plant
b. allocated manufacturing overhead
c. direct labor consumed
d. direct materials consumed
36. The term "conversion costs" refers to:
a. The sum of raw material costs and direct labor costs.
b. All costs associated with manufacturing other than direct labor costs.
c. Direct labor costs incurred to produce units of output.
d. The sum of direct labor costs and all factory overhead costs.
37. BINI Myra Enterprises manufactures digital video equipment. For each unit P2,950 of direct material is used and there is
P2,000 of direct manufacturing labor at P20 per hour. Manufacturing overhead is applied at $35 per direct manufacturing
labor hour. Calculate the cost of each unit.
a. P4,950
b. P9,950
c. P8,450
d. P11,950
38. Which of the following statements is correct?
I. Manufacturing costs are generally incurred in one period and recorded in a subsequent period.
II. The Purchases account is credited for all raw materials purchase returns and allowances.
a. Statement I only.
b. Statement II only.
c. Both statements are incorrect.
d. Both statements are correct

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PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control
College of Management and Accountancy First Periodic Examination - Set A

39. If the amount of overtime premium is to be charged to all jobs worked on during the period, the debit will be to:
a. Payroll.
b. Work in Process.
c. Accrued Payroll.
d. Factory Overhead.
40. Prime costs include
a. direct manufacturing labor and manufacturing overhead costs.
b. direct materials and manufacturing overhead costs.
c. only direct materials
d. direct materials and direct manufacturing labor costs.
41. Total manufacturing costs equal
a. direct materials + prime costs.
b. direct manufacturing labor costs + prime costs.
c. direct manufacturing labor costs + conversion costs.
d. direct materials + conversion costs.
42. The advantage of using normal costing instead of actual costing is:
a. indirect costs are assigned at the end of the year when they are known
b. the job cost is more accurate under normal costing
c. normal costing provides a higher gross profit margin
d. indirect costs are assigned to a job on a timely basis
43. During an accounting period, job costs are computed on an ongoing basis by the use of:
a. budgeted indirect-cost rates
b. actual allocation rates
c. overallocated indirect-cost rates
d. underallocated indirect-cost rates
44. A job that shows low profitability may be the result of:
a. wasting direct materials
b. inefficient direct manufacturing labor
c. underpricing the job
d. All of these answers are correct.
45. For a given job the direct costs associated with the job are:
a. actual overhead
b. direct material
c. direct manufacturing labor
d. Both b and c are correct.
46. Manufacturing overhead costs incurred for the month are:
Utilities P30,000
Depreciation on equipment P25,000
Repairs P20,000
Which is the correct journal entry assuming utilities and repairs were on account?
a. Manufacturing Overhead Control 75,000
Accounts Payable Control 75,000
b. Manufacturing Overhead Control 75,000
Accumulated Depreciation Control 75,000
c. Accumulated Depreciation Control 25,000
Accounts Payable Control 50,000
Manufacturing Overhead Control 75,000
d. Manufacturing Overhead Control 75,000
Accounts Payable Control 50,000
Accumulated Depreciation Control 25,000
47. This documents provides the management with the summation of the total cost for a given product.
a. job-order cost sheet
b. employee time sheet
c. material requisition form
d. bill of lading

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PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control
College of Management and Accountancy First Periodic Examination - Set A

THE FOLLOWING INFORMATION APPLIES TO THE NEXT FOUR (4) QUESTIONS

BINI Stacey Manufacturing uses a normal cost system and had the following data available for 2024:
Direct materials purchased on account P 148,000
Direct materials requisitioned 82,000
Direct labor cost incurred 130,000

Factory overhead incurred 146,000

Cost of goods completed 292,000
Cost of goods sold 256,000

Beginning direct materials inventory 26,000

Beginning WIP inventory 64,000
Beginning finished goods inventory 58,000
Overhead application rate, as a percent
of direct-labor costs 125 percent

48. The journal entry to record the materials placed into production would include a:
a. debit to Direct Materials Inventory for P148,000
b. credit to WIP Inventory for P82,000
c. debit to WIP Inventory for P148,000
d. credit to Direct Materials Inventory for P82,000
49. The ending balance of direct materials inventory is:
a. P147,000
b. P92,000
c. P82,000
d. P93,000
50. The ending balance of work-in-process inventory is:
a. P 438,500
b. P 130,000
c. P 146,500
d. P 422,000
51. The ending balance of finished goods inventory is:
a. P 94,000
b. P 58,000
c. P 36,000
d. P 292,000
52. Which of the following statements about actual costing and normal costing is true?
a. Manufacturing costs of a job are available earlier under actual costing.
b. Corrective actions can be implemented sooner under normal costing
c. Manufacturing costs are available earlier under normal costing.
d. Both B and C are correct.
53. In job order costing, normal spoilage which is a characteristic of a given production cycle shall be
a. Expensed as incurred
b. Charged or capitalized to a specific job
c. Closed to factory overhead account
d. Debited to work in process account
54. It is a costing system that values manufactured products with the actual material costs, actual direct labor costs and
manufacturing overhead based on a predetermined manufacturing overhead rate.
a. Actual costing system
b. Normal costing system
c. Standard costing system
d. Budgeted costing system

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PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control
College of Management and Accountancy First Periodic Examination - Set A

THE FOLLOWING INFORMATION APPLIES TO THE NEXT THREE (3) QUESTIONS

BINI Colet Manufacturing uses departmental cost driver rates to allocate manufacturing overhead costs to products. Manufacturing
overhead costs are allocated on the basis of machine-hours in the Machining Department and on the basis of direct labor-hours in
the Assembly Department. At the beginning of 20X3, the following estimates were provided for the coming year:
Machining Assembly
Direct labor-hours 30,000 60,000
Machine-hours 80,000 20,000
Direct labor cost P500,000 P900,000
Manufacturing overhead costs P420,000 P240,000

The accounting records of the company show the following data for Job #316:

Machining Assembly
Direct labor-hours 120 70
Machine-hours 60 5
Direct labor cost P300 P200
Manufacturing overhead costs P100 P400

55. For BINI Colet Manufacturing, what is the annual manufacturing overhead cost-allocation rate for the Machining
Department?
a. P5.25
b. P6.20
c. P6.25
d. P4.67
56. What amount of manufacturing overhead costs will be allocated to Job #316?
a. P593
b. P595
c. P582
d. P592
57. What are the total manufacturing costs of Job #316?
a. P1,595
b. P571
c. P980
d. P1,100
58. In a predetermined overhead rate in a job-order costing system that is based on machine hours, which of the following
would be used in the numerator and denominator?
Numerator Denominator
a. Actual manufacturing Overhead Actual machine hours
b. Actual manufacturing Overhead Estimated machine hours
c. Estimated manufacturing Overhead Actual machine hours
d. Estimated manufacturing Overhead Estimated machine hours
59. BINI Alexia Company's actual manufacturing overhead is P2,800,000. Overhead is allocated on the basis of direct labor
hours. The direct labor hours were 50,000 for the period. What is the manufacturing overhead rate?
a. P47.00
b. P56.00
c. P75.00
d. None of the above are correct.
60. The budgeted indirect cost rate is the budgeted indirect costs divided by budgeted quantity of the cost allocation base.
a. True
b. False
61. Direct costs are traced the same way for actual costing and normal costing.
a. True
b. False

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PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control
College of Management and Accountancy First Periodic Examination - Set A

THE FOLLOWING INFORMATION APPLIES TO THE NEXT TWO (2) QUESTIONS

For 2024, BINI Lovely Manufacturing uses machine-hours as the only overhead cost-allocation base. The accounting records contain
the following information:
Estimated Actual
Manufacturing overhead costs P200,000 P240,000
Machine-hours 40,000 50,000
62. Using job costing, the 2024 budgeted manufacturing overhead rate is:
a. P4.00 per machine-hour
b. P4.80 per machine-hour
c. P5.00 per machine-hour
d. P6.00 per machine-hour
63. Using normal costing, the amount of manufacturing overhead costs allocated to jobs during 2024 is:
a. P300,000
b. P250,000
c. P240,000
d. P200,000

THE FOLLOWING INFORMATION APPLIES TO THE NEXT TWO (2) QUESTIONS

BINI Joana Company manufactures picture frames of all sizes and shapes and uses a job-order costing system. There is always some
spoilage in each production run. The following costs relate to the current run:

Estimated overhead (exclusive of spoilage allowance) P160,000

Estimated spoilage allowance P 13,500
Estimated labor hours 100,000

The actual cost of a single spoiled picture frame is P7.00. During the year 170 frames are considered spoiled. Each spoiled frame can
be sold for P4.00.

64. Assuming the spoiled picture frames were due to internal failure, what is the journal entry to record the spoilage?
a. Spoiled Goods Inventory 510
MOH 680
Work-in-process 1,190
b. MOH 1,190
Work-in-process 1,190
c. Spoiled Goods Inventory 680
MOH 510
Work-in-process 1,190
d. Spoiled Goods Inventory 680
Work-in-process 680
65. Assuming the spoiled picture frames were due to exacting specifications, what is the journal entry to record the spoilage?
a. Spoiled Goods Inventory 510
MOH 680
Work-in-process 1,190
b. MOH 1,190
Work-in-process 1,190
c. Spoiled Goods Inventory 680
MOH 510
Work-in-process 1,190
d. Spoiled Goods Inventory 680
Work-in-process 680

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PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control
College of Management and Accountancy First Periodic Examination - Set A

66. Which of the following organizations would be most likely to use a job-order costing system?
a. the check clearing department of a bank
b. a manufacturer of processed cheese food
c. a manufacturer of video cassette tapes
d. the loan department of a bank
67. 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
68. In a job-costing system, a manufacturing firm typically uses an indirect-cost rate to estimate the ________ allocated to a
job.
a. direct materials
b. direct labor
c. manufacturing overhead costs
d. total costs
69. In a job-order costing system, the amount of the entry that debits Finished Goods Inventory and credits Work in Process
Inventory is the sum of the costs charged to all jobs
a. started in process during the period
b. in process during the period
c. completed and sold during the period
d. completed during the period
70. Which of the following could not be used in job-order costing?
a. Standards
b. normal costing
c. overhead allocation based on the job's direct labor hours
d. an average cost per unit for all jobs
71. A job-order costing system is likely to provide better
(1) inventory valuations for financial statements.
(2) control over inventory.
(3) information about ability to accept additional production work.
(1) (2) (3)

a. yes no no
b. no yes yes
c. no no no
d. yes yes yes
72. The general term used to identify both the tracing and the allocation of accumulated costs to a cost object is
a. cost accumulation
b. cost assignment
c. cost tracing
d. conversion costing
73. The collection of accounting data in some organized way is
a. cost accumulation
b. cost assignment
c. cost tracing
d. conversion costing
74. All of the following are true EXCEPT that indirect costs
a. may be included in prime costs
b. are not easily traced to products or services
c. vary with the selection of the cost object
d. may be included in manufacturing overhead

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PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control
College of Management and Accountancy First Periodic Examination - Set A

THE FOLLOWING INFORMATION APPLIES TO THE NEXT THREE (3) QUESTIONS

BINI EMMA company uses a perpetual inventory system had the following transactions for Material #106 during June

June 1 Beginning balance 2,300 units @12.00 per unit

4 Issued 1,200 units
6 Received 1,000 units @ P13.30 per unit
8 Issued 1,000 units
14 Received 500 units @ P14.00 per unit
17 Issued 800 units
20 Received 500 units @ P14.16 per unit

75. Using FIFO, how much is the ending balance of materials?

a. 18,070.00
b. 16,680.00
c. 17,520.48
d. 19,480.25
76. Using LIFO, how much is the ending balance of materials?
a. 18,070.00
b. 16,680.00
c. 17,520.48
d. 19,480.25
77. Using Average costing, how much is the ending balance of materials?
a. 18,070.00
b. 16,680.00
c. 17,520.48
d. 19,480.25
78. Companies typically wait for accurate information regarding actual manufacturing overhead costs before pricing a job.
a. True
b. False
79. Overtime premium consists of the wages paid to all workers (for both direct labor andindirect labor) in excess of their
straight-time wage rates.
a. True
b. False
80. I. Cost accounting provides information only for management accounting purposes.
II. Cost accounting provides information for financial accounting as well as for management accounting purposes.
a. Only I is true
b. Only II is True
c. All is False
d. All is True
81. The approach often used when dealing with small amounts of underallocated or overallocated overhead is the ________
approach.
a. adjusted allocation-rate
b. proration
c. write-off to cost of goods sold
d. Both A and B are correct.
82. One reason indirect costs may be overapplied is because:
a. the actual allocation base quantity exceeds the budgeted quantity
b. budgeted indirect costs exceed actual indirect costs
c. requisitioned direct materials exceed budgeted material costs
d. Both A and B are correct.
83. The difference between actual costing and normal costing is:
a. normal costing uses actual quantities of direct-costs
b. actual costing uses actual quantities of direct-costs
c. normal costing uses budgeted indirect-costs
d. actual costing uses actual quantities of cost-allocation bases

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PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control
College of Management and Accountancy First Periodic Examination - Set A

84. The spreading of underallocated or overallocated overhead among ending work-in-process, finished goods, and cost of
goods sold is called:
a. the adjusted allocation rate approach
b. the proration approach
c. the write-off of cost of goods sold approach
d. None of these answers are correct.
85. Which of the following statements about normal costing is true?
a. Direct costs and indirect costs are traced using an actual rate.
b. Direct costs and indirect costs are traced using budgeted rates.
c. Direct costs are traced using a budgeted rate, and indirect costs are allocated using an actual rate.
d. Direct costs are traced using an actual rate, and indirect costs are allocated using a budgeted rate.
86. When using a normal costing system, manufacturing overhead is allocated using the ________manufacturing overhead rate
and the ________ quantity of the allocation base.
a. budgeted; actual
b. budgeted; budgeted
c. actual; budgeted
d. actual; actual
87. When the allocated amount of indirect costs are less than the actual amount, indirect costs have been:
a. Overabsorbed
b. Underapplied
c. Underallocated
d. Both underapplied and underallocated are correct
88. ________ costing is used by a business to price unique products for different jobs.
a. Actual
b. Job
c. Process
d. Traditional
89. A certain type of computer costs P1,000, and the annual holding cost is 25%. Annual demand is 10,000 units, and the order
cost is P150 per order. What is the approximate economic order quantity?
a. 16
b. 70
c. 110
d. 183
e. 600
90. A ________ is a grouping of individual indirect cost items
a. cost allocation base
b. cost assignment
c. cost pool
d. job-costing system
91. In a job-order costing system, the cost of a completed but unsold job is:
a. Closed to cost of goods sold
b. Part of the work in process inventory balance
c. Adjusted to exclude any applied overhead
d. Part of the finished goods inventory balance
92. A good description of “cost of goods manufactured” is the recorded cost of the:
a. Units completed during the period
b. Units started and completed during the period
c. Work done on all units during the period
d. Work done this period on units completed this period
93. In a job-order costing system, the application of manufacturing overhead would be recorded as debit to:
a. Raw materials Inventory
b. Finished goods Inventory
c. Work in process Inventory
d. Cost of Goods sold

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PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control
College of Management and Accountancy First Periodic Examination - Set A

94. In a job-order costing system, the incurrence of indirect labor cost would usually be recorded as a debit to:
a. Manufacturing Overhead
b. Finished goods
c. Work in process
d. Cost of Goods sold
95. Cost of normal spoilage, rework and revenue from scrap may be treated in all of the following ways, except:
a. Charged to specific unrelated jobs
b. Charged to specific related jobs
c. Spread across all jobs
d. Treated as a miscellaneous revenue or expense, as required
96. I. Normal costing is a method of job costing that allocates an indirect cost based on the actual indirect-cost rate times the
actual quantity of the cost-allocation base.
II. Actual costing is a method of job costing that allocates an indirect cost based on the actual indirect-cost rate times the
actual quantity of the cost-allocation base.
a. A Only I is true
b. Only II is True
c. All is False
d. All is True
97. When scrap is insignificant in value
a. It is recorded when discovered
b. It may not be recognized until the point of sale
c. It is recognized at the point of production
d. It Is recorded at its fair market value
98. Underapplied factory overhead results when
a. A plant is operated at less than normal capacity
b. Factory overhead costs incurred are greater than costs charged to production
c. Factory overhead costs are less than the cost charged to production
d. Factory overhead costs are unreasonably low
99. Spoiled units are
a. Units that cannot be economically reworked to bring them up to standard
b. Units that can be economically reworked to bring them up to standard
c. The same as defective units
d. Considered as abnormal losses
100. Units of production that must be reprocessed to be sold as finished goods are best known as
a. Reworked units
b. Scrap
c. Spoilage
d. Work in process

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PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control
College of Management and Accountancy First Periodic Examination - Set A

Part II: Straight Problems. Two (2) points each item.

Problem 1:
BINI Mikha Company uses job order costing system. The following costs were accumulated for the month of
November:

Costs added during November

Job No. November 1 Direct materials Direct labor
05 11,000 3,300 2,200
06 15,400 2,750 3,300
07 5,500 16,500 1,650
08 8,250 44,000 4,400

Direct labor rate was 10 per direct labor hour. It was the company's policy to apply overhead based on direct labor hours with a rate
of 5 per direct labor hour. Jobs 05, 06, and 07 were completed and Job 06 was sold to customers.

101. What is the amount cost of goods manufactured for the month end November 30, 2024?
102. What is the amount of cost of goods sold for the month end November 30, 2024?
103. What is the amount of work-in-process on November 30, 2024?

Problem 2:
The following information were extracted from Job 168 of BINI Aiah Company:

Direct materials 175,000

Direct labor 262,500
Predetermined OH rate per unit (inclusive of allowance) 3.00
Predetermined OH rate per unit (exclusive of allowance) 2.25
Units produced 150,000

The total cost of the spoiled units was P45,600 if inclusive of allowance and P40,500 if exclusive of allowance. It can be sold at a price
of P17,000.

104. Assuming the spoilage is due to internal failure, what is the total cost transferred to finished goods?
105. Assuming the spoilage is due to exacting specifications, what is the total cost transferred to finished goods?

Problem 3:

BINI Maloi Company employed normal costing for its production. The entity provided following data during the current year:

Net purchases of raw materials during the year 250,000

Total labor costs during the year 400,000
Depreciation of factory assets during the year 50,000
Utilities on the factory during the year 150,000

Beginning Ending
Raw materials inventory 100,000 150,000
Work in process inventory 250,000 100,000
Finished goods inventory 300,000 150,000

 The entity used a single account for its direct material and indirect materials. Indirect material used was one-fourth of the
total direct material used.
 The indirect labor cost was 1/8 of the total labor costs.
 The overhead application rate was 80% of direct labor costs.
 Any over or under application of overhead was considered material.

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PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control
College of Management and Accountancy First Periodic Examination - Set A

106. What amount should be reported as total manufacturing cost during the current year?

Problem 4:
BINI Gwen Company used a job order costing system. The entity had three jobs in process: #7, #10, and #13. The entity provided the
following information:

Raw material used P130,000

Direct labor per hour P9.50
Overhead applied based on direct labor cost 125%

Direct material was requisitioned for each job respectively: 25 percent, 30 percent, and 30 percent. The balance of the requisitions
was considered indirect. Direct labor hours per job are 2,800, 3,300 and 4,000, respectively for Job #7, Job #10 and Job #13. Indirect
labor is P45,000. Other actual overhead costs totaled P50,000.

107. What amount should BINI Gwen Company report as prime cost for Job #7?
108. What amount should BINI Gwen Company report as overhead applied for Job #13?

Problem 5:
BINI Sheena Corporation manufactures brake rotors to the exacting specification of customers. During August 2024,
Job 800 for the production of 40,500 units were completed at the following costs per unit:

Direct Materials P120

Direct Labor 40
Factory Overhead applied 160

Final inspection of Job 800 disclosed 900 defective units and 450 spoiled units. The defective units were reworked at a total cost of
P108,000, and the spoiled units were sold for P27,000.

109. What is the unit cost of the good units produced for Job 800?
110. What is the amount of cost transferred to finished goods for Job 800?

-END-

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PHINMA University of Pangasinan ACC 122 | Cost Accounting and Control
College of Management and Accountancy First Periodic Examination - Set A

Straight Problems Answer Sheet

Two (2) points each item
You can solve on the space provided.

1. 6.
2. 7.
3. 8.
4. 9.
5. 10.

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