Question

Under a job order costing system, the dollar amount of the entry involved in the transfer...

Under a job order costing system, the dollar amount of the entry involved in the transfer of goods from work-in-process inventory to finished goods inventory is the total of the costs charged to all jobs

A) started during the period

B) completed during the period

C) completed and sold during the period

D) started and completed during the period

Which of the following would not be an appropriate allocation base for assigning utility costs for heating three separate product line production departments?

A) sales generated by each department

B) square footage used by each department

C) machine hours used by each department

D) kilowatt hours used by each department

Business   Accounting   
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Homework Answers

Answer #1

The correct answer is Option B.

The entry reflects the transfer of the cost of the jobs that are completed during the period irrespective of whether it was started during that period or not. So implying that even if it was started during that period and it did not finish, it will not be transferred to finished goods. Hence Option A is inccorrect.

The goods that are completed and sold during the period will be recorded as cost of goods sold. Hence Option C is incorrect.

The work-in process can have a opening balance of jobs that are already started, hence such jobs may also finish during the period, hence those will also be transfered. Hence, it can not be said that the entry will reflect only those jobs that are started and completed during the period. Hence, Option D is incorrect.

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