19A1 - Cost Accounting - Process Costing (II)

The process costing system is best suited for:

• service industries only

• industries where different types of products are manufactured

• industries where homogeneous products are manufactured on continuous basis

• all of the above

Which of the following businesses is likely to adopt a process costing system?

• Construction companies

• Sugar refining units

• Plan manufacturers

• Printing presses

Which of the following is the best explanation of the relevance of equivalent production units in process costing?

• A means by which the output achieved may be compared with the equivalent quantity budgeted for the period under review.

• The expression of losses in terms of an equivalent number of units of good production in order that their value may be calculated.

• A means of equalising production charged into stock each period.

• The conversion partly completed units into an equivalent number of completed units in order that costs may be shared on an equitable basis.

......... shows the flow of units and costs through work in process.

In a process-costing system, ........ are calculated by dividing total costs incurred by the number of units of output from the production process.