The costing system that uses job-order costing to assign material costs and process costing to assign conversion costs is called:
A)Batch production process
B)Cost reconciliation
C)Operation costing
D)Equivalent unit of output

Question

Quizplus · Accepted Answer

The costing system described is a combination of job-order costing and process costing, which is known as operation costing. This system is used in industries where products or services are produced in batches, but each batch is customized to meet specific customer requirements. In the operation costing system, material costs are assigned using job-order costing, while conversion costs (labor and overhead) are assigned using process costing. Therefore, the correct answer is C.

The Costing System That Uses Job-Order Costing to Assign Material