If a Company Uses a Process Costing System to Account

question 111

Multiple Choice

If a company uses a process costing system to account for the costs in its five production departments, how many work in process accounts will it use?

• A) 6
• B) 5
• C) 4
• D) 2

---

Definitions:

Geothermal Heat Pump

A central heating and/or cooling system that transfers heat to or from the ground, using the earth as a heat source or sink.

Net Present Value

A financial metric that estimates the profitability of an investment or project by calculating the difference between the present value of cash inflows and outflows over a period of time.

Compound Interest

Interest calculated on the initial principal and also on the accumulated interest from previous periods.

Cash Payback Period

The time it takes for an investment to generate an amount of cash inflows equal to the initial cost of the investment.