Acct2-Chapter 4

True

Both job-order and process costing systems use averaging to compute unit product costs.

a paper mill that processes wood pulp into large rolls of paper

For which situation(s) below would an organization be more likely to use a process costing system of rather than a job-order costing system?

False

Process costing is used in those situations where many different products or services are produced each period to customer specifications.

False

The "costs accounted for" portion of the cost reconciliation report includes the cost of beginning work in process inventory and the cost of units transferred out.

False

The "costs accounted for" portion of the cost reconciliation report includes the cost of ending work in process inventory and the costs added during the period.

True

The "costs to be accounted for" portion of the cost reconciliation report includes the cost of beginning work in process inventory and the costs added during the period.

False

The units in beginning work in process inventory plus the units in ending work in process inventory must equal the units transferred out of the department plus the units started into production.

True

When materials are purchased in a process costing system, a materials account is debited with the cost of the materials.

Oil Refinery

Which of the following companies would be most likely to use a process costing system?