Austin Company Uses a Job Order Cost Accounting System

question 15

Multiple Choice

Austin Company uses a job order cost accounting system.The company's executives estimated that direct labor would be $2,000,000 (200,000 hours at $10/hour) and that factory overhead would be $1,500,000 for the current period.At the end of the period,the records show that there had been 180,000 hours of direct labor and $1,200,000 of actual overhead costs.Using direct labor hours as the allocation base,calculate the under- or overapplied overhead for the period.

• A) $150,000 overapplied.
• B) $150,000 underapplied.
• C) $300,000 underapplied.
• D) $300,000 overapplied.
• E) $200,000 underapplied.

Grasp the fundamental concepts and differences between traditional and modern management accounting practices, including costing and performance measurement.

Delineate the impact of activity levels on cost behavior, including the relationships between production volume and cost behavior (variable and fixed).

Comprehend the role and importance of information, including qualitative and quantitative data, in planning and decision-making processes within organizations.

Identify and classify costs within the production and value chain, including manufacturing overhead and non-manufacturing expenses.

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Definitions:

Attribution Theory

A theory that explains how individuals pinpoint the causes of their own and others’ behavior.

General Mental Ability

An individual's overall capacity to think abstractly, reason, plan, solve problems, comprehend complex ideas, learn quickly, and learn from experience.

Psychological Approach

A method of understanding human behavior that focuses on the mental processes and emotional factors influencing individuals.

Human Behavior

The range of actions and mannerisms exhibited by humans in conjunction with their environment, influenced by culture, attitudes, emotions, and values.