Bruce Company experienced an event that affected its financial statements as indicated below: $\begin{array}{|c|c|c|c|c|c|c|c|c|c|c|c|}
\hline & \text { Assets }&&= & \text { Liab. } & + & \text { Equity } & \text { Rev. } & - & \text { Exp. } & = & \text { Net Inc. } \
\hline \text { Mfg. } & + & \text { WIP } & & & & & & & & \
\text { Mixing }& &\text { Packing }\
\hline (10,500)& + & (10,500) &= & \text { NA } & +&\text { NA } &\text { NA } & -&\text { NA }& = & \text { NA }\
\hline
\end{array}$ What type of product costing system is being used by this company?
A) Job-order cost system
B) Hybrid cost system
C) Process cost system
D) None of these.

Question

Bruce Company experienced an event that affected its financial statements as indicated below: $\begin{array}{|c|c|c|c|c|c|c|c|c|c|c|c|}
\hline  & \text { Assets }&&= & \text { Liab. } & + & \text { Equity } & \text { Rev. } & - & \text { Exp. } & = & \text { Net Inc. } \
\hline \text { Mfg. } & + & \text { WIP } & & & & & & & & \
\text { Mixing  }&  &\text { Packing }\
\hline (10,500)& + & (10,500) &= & \text { NA } & +&\text { NA } &\text { NA } & -&\text { NA }& = & \text { NA }\
\hline
\end{array}$ What type of product costing system is being used by this company?
A) Job-order cost system
B) Hybrid cost system
C) Process cost system
D) None of these.

Quizplus · Accepted Answer

The movement of costs from one work-in-process account to another (Mixing to Packing) suggests a process cost system, which is used for continuous production processes.

Bruce Company Experienced an Event That Affected Its Financial Statements