Process costing systems:
A) Are used when companies produce homogeneous units.
B) Does not have work-in-process accounts for each department.
C) Does not use equivalent units of production.
D) Track costs to individual products.

Question

Quizplus · Accepted Answer

Process costing systems are used when companies produce homogeneous units, meaning that each unit produced is identical or very similar to the others. This type of system is typically used in industries such as chemical processing, food processing, and oil refining, where large quantities of identical products are produced. Process costing systems allocate costs to each unit based on the average cost of all units produced.

Process Costing Systems