Process Costing Techniques Should Be Used in Assigning Costs to Products

question 128

Multiple Choice

Process costing techniques should be used in assigning costs to products

• A)if a product is manufactured on the basis of each order received.
• B)when production is only partially completed during the accounting period.
• C)if a product is composed of mass-produced homogeneous units.
• D)whenever standard-costing techniques should not be useD.

---

Definitions:

Lockbox Arrangements

A service provided by banks to process payments quickly by collecting and depositing checks into the company's account on behalf of the company.

Collection of Payments

The process of gathering all monetary amounts owed to an individual or organization by its debtors or customers.

DRIP Payments

Dividend Reinvestment Plan payments, where dividends paid by a corporation are automatically reinvested to purchase more shares of the company's stock.

EOQ

Economic Order Quantity; the ideal order quantity a company should purchase to minimize its total costs related to ordering, receiving, and holding inventory.