Which of the Following Types of Entities Would Probably Use

question 46

Multiple Choice

Which of the following types of entities would probably use a process costing system?

• A)Oil refiner
• B)Construction company
• C)Airplane manufacturer
• D)CPA firm

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Definitions:

Finished Goods Inventory

The stock of completed products that are ready to be sold but have not yet been sold to customers.

Standard Costing System

A method of cost accounting that involves assigning expected costs to production and then analyzing any variances between those expected costs and actual costs incurred.

Work in Process Inventory

Goods that are in the process of being manufactured but are not yet complete.

Finished Goods Inventory

The stock of completed products that are ready to be sold but have not yet been purchased by customers.