International Financial Reporting Standards (IFRS) mandates the type of product costing system (job costing or process costing) that must be used by a manufacturer for external reporting.

Question

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IFRS does not mandate a specific costing system for external reporting by manufacturers. Instead, it requires companies to use a consistent and appropriate costing system that provides reliable information about the costs incurred in producing their products. Therefore, a manufacturer can use either job costing or process costing, depending on the nature of its operations and the type of products it produces.

International Financial Reporting Standards (IFRS) Mandates the Type of Product