Process Costing

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

Cement manufacturer Pencil and pen manufacturer

is/are the number of complete, whole units one could obtain from the materials and effort contained in partially completed units.

Equivalent units

Which of the following characteristics applies to process cost accounting?

Involves multiple production processes

Which of the following statements about process costing is correct?

Overhead can be under or over applied, just as in job order costing. Products are normally mass-produced. Equivalent units are separately computed for materials and for conversion costs.

Which of the following items produced by a company would a process costing system be appropriate for?

Seedlings for sale in a nursery Packets of flower seeds

work-in-process (WIP) account(s) to account for the costs in its four production departments using a process costing system.

four

A company that applies process costing is most frequently characterized by __________.

homogeneous products a high production volume

A process cost system is employed in situations where __________.

products are mass-produced a manufacturing involves a single, homogeneous product

Equivalent units of production =

units transferred out

In a process costing system, each processing department has a

work-in-process