Accounting Information Systems
10th Edition
ISBN: 9781337619202
Author: Hall, James A.
Publisher: Cengage Learning,
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Chapter 7, Problem 1MCQ
To determine
Identify the incorrect statement.
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Which of the following descriptions is notcorrect?a. The routing sheet shows the manufacturingpath for a particular product.b. Bill of materials shows the cost of producing asingle unit.c. Move ticket authorizes the movement of abatch from one department to another.d. Materials requisition authorizes the storekeeperto release materials.
Match each of the following items A through G with the best numbered description of its purpose. A. Factory Overhead account E. Raw Materials Inventory account B. Process cost summary F. Materials requisition C. Equivalent units of production G. Finished Goods Inventory account D. Work in Process Inventory accounts 1. Notifies the materials manager to send materials to a production department. 2. Holds indirect costs until assigned to production. 3. Hold production costs until products are transferred from production to finished goods (or another department). 4. Standardizes partially completed units into equivalent completed units. 5. Holds costs of finished products until sold to customers. 6. Describes the activity and output of a production department for a period. 7. Holds costs of materials until they are used in production or as factory overhead.
1. The materials requisition:
a.informs the purchasing agent of the quantity and type of materials needed.
b. contracts for quantities to be delivered.
c. authorizes the storeroom to deliver types and quantities of materials to a given department.
d. is the list of materials requirements for each step in the production cycle.
2. The purchase order:
a. contracts for quantities to be delivered.
b. authorizes the storeroom to deliver materials to a given department.
c. is the list of materials requirements for each step in the production cycle.
d. informs the purchasing agent of the quantity and kind of materials needed.
3. The receiving report:
a.certifies quantities received and reports results of inspection and testing.
b. is the list of materials needed for each step in the production cycle.
c. contracts for quantities to be delivered.
d. informs the purchasing agent of the quantity and…
Chapter 7 Solutions
Accounting Information Systems
Ch. 7 - Prob. 1RQCh. 7 - Prob. 2RQCh. 7 - Distinguish between continuous, batch, and...Ch. 7 - Prob. 4RQCh. 7 - What are the primary determinants for both...Ch. 7 - What are the objectives of inventory control in...Ch. 7 - Prob. 7RQCh. 7 - What documents are needed for cost accounting...Ch. 7 - What types of management reports are prepared by...Ch. 7 - What document signals the completion of the...
Ch. 7 - Prob. 11RQCh. 7 - Prob. 12RQCh. 7 - Prob. 13RQCh. 7 - What is meant by the statement Inventories...Ch. 7 - What are the primary goals of lean manufacturing?Ch. 7 - Distinguish between activities and cost objects in...Ch. 7 - Differentiate between essential and nonessential...Ch. 7 - Prob. 18RQCh. 7 - Define computer-integrated manufacturing.Ch. 7 - Prob. 20RQCh. 7 - Discuss the importance of the move ticket to the...Ch. 7 - How realistic are the assumptions of the economic...Ch. 7 - Explain why the economic order quantity is the...Ch. 7 - Supervisors in the work centers oversee the usage...Ch. 7 - Prob. 5DQCh. 7 - Prob. 6DQCh. 7 - Prob. 7DQCh. 7 - How does automation help achieve manufacturing...Ch. 7 - Prob. 9DQCh. 7 - How can poor quality be expensive to the firm,...Ch. 7 - Discuss how an emphasis on financial performance...Ch. 7 - Prob. 12DQCh. 7 - How are cost structures fundamentally different...Ch. 7 - Prob. 14DQCh. 7 - Prob. 15DQCh. 7 - Discuss the advantages of activity-based costing.Ch. 7 - Discuss the disadvantages of activity-based...Ch. 7 - Explain why traditional cost allocation methods...Ch. 7 - Explain the concept of a product family and its...Ch. 7 - Explain the relationship between MRP II and ERP.Ch. 7 - Prob. 1MCQCh. 7 - Which of the following is NOT a problem associated...Ch. 7 - Which of the following is NOT a principle of lean...Ch. 7 - Which line segment represents the reorder lead...Ch. 7 - Which line segment represents the demand? a. DE b....Ch. 7 - Which statement describes the evolution of...Ch. 7 - Which of the following statements regarding...Ch. 7 - Refer to the equation for the EOQ in the text. Car...Ch. 7 - DOCUMENT FLOWCHART Prepare a flowchart that...Ch. 7 - Prob. 2PCh. 7 - Prob. 3PCh. 7 - Prob. 4PCh. 7 - Prob. 5PCh. 7 - ZERO DEFECTS PROCESS Northern Tractor is a...Ch. 7 - ACTIVITY DRIVERS Cut It Up, Inc., is a...Ch. 7 - LEAN MANUFACTURING PRINCIPLES Write an essay...Ch. 7 - Internal Control Cases UTICA LIGHTING COMPANY...Ch. 7 - LAWN WIZARD INC. (MANUAL SYSTEM WITH STAND-ALONE...Ch. 7 - Prob. 4ICCCh. 7 - Prob. 5ICC
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- For each cost pool, identify an appropriate cost driver. A. order department B. accounts receivable processing C. catering D. raw material inventoryarrow_forwardExplain how each activity in this list can be associated with the corresponding unit or batch level provided. A. Assembling products: unit level B. Issuing raw materials: batch level C. Machine setup: batch level D. Inspection: unit level E. Loading the labeling machine: batch level F. Equipment maintenance: batch level G. Printing a banner: unit level H. Moving material: batch level I. Ordering a part: batch levelarrow_forwardExplain how each activity in this list can be associated with the corresponding unit or batch level provided. A. Assembling products: batch level B. Issuing raw materials: unit level C. Machine setup: unit level D. Inspection: batch level E. Loading the labeling machine: unit level F. Equipment maintenance: unit level G. Printing a banner: batch level H. Moving material: unit level i. ordering a part: unit levelarrow_forward
- Appropriate base to allocate purchase department cost to different products is? A. Machine Hour B. Purchase Order C. Closing stock of Material D. Units of outputarrow_forwardAccounting Questionarrow_forwardPlease refer the problem from the attached images below. Required: Compute the units of equivalent production for materials and conversion costs. Compute the cost of ending work in process inventory. Prepare a cost of production report.arrow_forward
- The appropriate cost accounting system to use when inventory items are produced on an assembly line is a. perpetual method. b. job-order costing. c. weighted average. d. process costing.arrow_forwardWhich of the following is a characteristic of a process cost accounting system? A. Material, Labor, and Overheads are accumulated by orders. B. Companies use this system if they process custom orders. C. Only Closing stock of work in process is restated in terms of completed units. D. Opening and Closing stock of work in process are related in terms of completed units.arrow_forward2. Show how to prepare a journal entry to enter direct materials costs into the WIP Inventory account for the first department in a sequential production process. Show how to prepare the journal entry recording the transfer of goods from the first to the second department.arrow_forward
- Which of the following accounts would be debited to record the assignment of indirect materials? Group of answer choices Work-in-process inventory Manufacturing overhead Supplies expense Costs of goods soldarrow_forwardA. Multiple Choice:Write the letter of the correct answer in the given worksheet. When the amount of overapplied manufacturing overhead as significant, the netry to close Overapplied Manufacturing Overhead will most likely require: a. A debit to Cost of Goods Sold b. Debits to Cost of Goods Sold, Finished Goods Inventory, and Work in Process Inventory C. A credit to Cost of Goods Sold d. Credit to Cost of Goods Sold, Finished Goods Inventory, and Work in Process Inventory. An objection to the use of predetermined overhead rate based on direct labor costs is that a. These items are difficult to measure. b. A job is charged with more overhead when a highly paid operator works on the job than when a low paid operator performs the work. C. Overhead is allocated in relation to units produced by workers. d. Overhead rate will be distributed inequitable when there are no wage differentials in the department. 3. All of the following phrases are used as alternate terminology for manufacturing…arrow_forwardA manufacturer reports three activities: assembling components into products; product design; and sales order processing. Determine whether each of the following cost drivers relates to assembly, design, or order processing. Cost Driver 1. Direct labor hours to assemble components 2. Number of design changes 3. Number of components assembled 4. Number of design hours 5. Number of shipments made 6. Number of sales orders processed Activityarrow_forward
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