Under process costing, the total production costs incurred must be split between the units that have been completed in that process and transferred to the next process and the:
A)Finished Goods Inventory if it is the first process.
B)units not completed and remaining in Work-in-Process Inventory for that department.
C)Cost of Goods Sold when the units are sold.
D)Work-in-Process Inventory of the previous department when there are no sales.

Question

Quizplus · Accepted Answer

The total production costs incurred in a process are allocated between the units transferred to the next process and the units remaining in the work-in-process inventory of that department. The costs associated with the completed units are transferred to the next process, while costs related to the units that are not completed remain in work-in-process inventory until they are completed. The finished goods inventory and cost of goods sold are not relevant until the production process is complete and the units are sold. The work-in-process inventory of the previous department is also not relevant as it has already been allocated its share of costs.

Under Process Costing, the Total Production Costs Incurred Must Be