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Copyright © 2018 McGraw-Hill Education.All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
02-1 Chapter 2
JOB ORDER COSTING AND ANALYSIS
True/False Questions
- Cost accounting systems accumulate manufacturing costs and then assign them to products
and services.
Answer: True
Blooms: Remember
AACSB: Communication
AICPA BB: Industry
AICPA FN: Measurement
Difficulty: 1 Easy
Learning Objective: 02-C1
Topic: Job Order Costing
- A company that uses a cost accounting system normally has only two inventory accounts:
Finished Goods Inventory and Work in Process Inventory.
Answer: False
Blooms: Remember
AACSB: Communication
AICPA BB: Industry
AICPA FN: Measurement
Difficulty: 1 Easy
Learning Objective: 02-C1
Topic: Job Order Costing
- Cost accounting information is helpful to management for pricing decisions but has no
effect on controlling costs.
Answer: False
Blooms: Understand
AACSB: Communication
AICPA BB: Industry
AICPA FN: Measurement
Difficulty: 2 Medium
Learning Objective: 02-C1
Topic: Job Order Costing
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Copyright © 2018 McGraw-Hill Education.All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
02-2
- There are two basic types of cost accounting systems: job order costing and periodic
costing.
Answer: False
Blooms: Remember
AACSB: Communication
AICPA BB: Industry
AICPA FN: Measurement
Difficulty: 1 Easy
Learning Objective: 02-C1
Topic: Job Order Costing
- There are two basic types of cost accounting systems: job order costing and process
costing.
Answer: True
Blooms: Remember
AACSB: Communication
AICPA BB: Industry
AICPA FN: Measurement
Difficulty: 1 Easy
Learning Objective: 02-C1
Topic: Job Order Costing
- A company that produces a large number of standardized units would normally use a job
order costing system.
Answer: False
Blooms: Remember
AACSB: Communication
AICPA BB: Industry
AICPA FN: Measurement
Difficulty: 1 Easy
Learning Objective: 02-C1
Topic: Job Order Costing
- A company that produces products individually designed to meet the needs of a specific
customer would normally use a job order costing system.
Answer: True
Blooms: Remember
AACSB: Communication
AICPA BB: Industry
AICPA FN: Measurement
Difficulty: 1 Easy
Learning Objective: 02-C1
Topic: Job Order Costing
Copyright © 2018 McGraw-Hill Education.All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
02-3
- Job order production systems would be appropriate for companies that produce custom
homes, specialized equipment, and special computer systems.
Answer: True
Blooms: Remember
AACSB: Communication
AICPA BB: Industry
AICPA FN: Measurement
Difficulty: 1 Easy
Learning Objective: 02-C1
Topic: Job Order Costing
- Job order production systems would be appropriate for companies that produce compact
disks or disposable cameras.
Answer: False
Blooms: Remember
AACSB: Communication
AICPA BB: Industry
AICPA FN: Measurement
Difficulty: 1 Easy
Learning Objective: 02-C1
Topic: Job Order Costing
Copyright © 2018 McGraw-Hill Education.All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
02-4
- A job order costing system would be appropriate for a manufacturer of automobile tires.
Answer: False
Blooms: Remember
AACSB: Communication
AICPA BB: Industry
AICPA FN: Measurement
Difficulty: 1 Easy
Learning Objective: 02-C1
Topic: Job Order Costing
- Job order production systems would be appropriate for companies that produce training
films for a specific customer or custom-made furniture to be used in a new five-star resort hotel.
Answer: True
Blooms: Remember
AACSB: Communication
AICPA BB: Industry
AICPA FN: Measurement
Difficulty: 1 Easy
Learning Objective: 02-C1
Topic: Job Order Costing
- When a job involves producing more than one unit of a custom product, it is often called a
job lot.
Answer: True
Blooms: Remember
AACSB: Communication
AICPA BB: Industry
AICPA FN: Measurement
Difficulty: 1 Easy
Learning Objective: 02-C1
Topic: Job Order Costing
- A company's file of job cost sheets for jobs that are not yet completed equals the balance
in the Finished Goods Inventory account.
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