Most Process Costing Systems Use Weighted Average Process Costs

question 22

Multiple Choice

Most process costing systems use weighted average process costs.Which of the following is a characteristic of weighted average process costs systems?

• A)These systems account only for costs incurred during the current period.
• B)These systems are not appropriate for environments that involve mass production.
• C)The weighted average process cost system is required by GAAP.
• D)These systems do not distinguish between the costs from the prior period and costs incurred during the current period.
• E)None of the above is a characteristic of weighted average process costs systems.

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Definitions:

Time Ticket

A record that tracks the amount of time an employee spends on various activities or tasks, used for billing clients or allocating labor costs.

Service Firms

Businesses that provide intangible products or services to consumers or other businesses.

Manufacturing Firms

Companies that use labor, equipment, and raw materials to produce finished goods on a large scale.

Work in Process Inventory

Goods partially completed during the manufacturing process, not yet ready for sale.