Which of the following production operations would be most likely to employ a process cost system? a. Shipbuilder b. Aircraft manufacturer c. Bottler of mineral water d. Homebuilder
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
1. Which of the following production operations would be most likely to employ a process cost system?
a. Shipbuilder
b. Aircraft manufacturer
c. Bottler of mineral water
d. Homebuilder
2. The total amount in the Cost to Account For Schedule must equal the total amount on the
a. Equivalent Production Schedule
b. Quantities Schedule
c. Cost to Account For Schedule
d. Costs Accounted For Schedule
3. Which of the following products would most likely be accounted for with a
a. A retailer
b. A public accounting firm
c. Airplane manufacture
d. Gasoline refinery
4. An item that does not appear on a cost of production report is:
a. Cumulative costs through the end of departmental production
b. Beginning work in process inventory
c. Ending finished goods inventory
d. Ending work in process inventory
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