Which cost accounting system accumulates operational costs by specific manufacturing processes or departments rather than individual jobs?
AJob Order Costing
BProcess Costing
CStandard Costing
DDirect Costing
Explanation
• Process Costing is used in mass-production industries producing identical continuous products (e.g., oil refining, chemical processing, paper production).
• Job Order Costing accumulates costs for distinct custom jobs or unique customer batches.
• Process costing computes average unit cost by dividing total process costs by total output units produced.
Exam Relevance
- Topic: Cost Accounting
- Subtopic: Costing Systems

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