Process costing systems consider overhead costs to include those costs that cannot be traced to a specific process.

Question

Quizplus · Accepted Answer

Process costing systems allocate indirect costs, also known as overhead costs, to the production process. These costs include items such as rent, utilities, and salaries of support staff, which are not directly linked to a specific job or product. Therefore, process costing considers overhead costs that cannot be traced to a particular process.

Process Costing Systems Consider Overhead Costs to Include Those Costs