Which of the following characteristics applies to process costing,but does not apply to job order costing?
A)The use of single Work in Process accounts
B)The use of equivalent units
C)Separate,identifiable jobs
D)The use of predetermined overhead rates

Question

Quizplus · Accepted Answer

The use of equivalent units is a characteristic that applies to process costing because the process involves the production of large quantities of homogeneous products that are identical in nature. Each unit is considered to be the equivalent of every other unit produced during the same period. Job order costing, on the other hand, involves the production of custom-made products that are distinct from one another, and therefore, the use of equivalent units is not applicable. Choices A, C, and D all apply to both process costing and job order costing.

Which of the Following Characteristics Applies to Process Costing,but Does