Process costing accumulates costs by individual jobs rather than by processing departments.

Question

Quizplus · Accepted Answer

Process costing accumulates costs by processing departments, not by individual jobs. It is used in industries where products are homogeneous and the production process is continuous, such as chemical manufacturing or food processing. In process costing, costs are accumulated for each department or process, and then allocated to the units produced in that department. This enables management to determine the cost of each unit and determine the profitability of each department.

Process Costing Accumulates Costs by Individual Jobs Rather Than by Processing