For which business is process costing is most appropriate?
A) a print shop
B) a headhunting firm
C) a custom bike builder
D) a vitamin manufacturer

Question

Quizplus · Accepted Answer

Process costing is most appropriate for businesses that produce homogeneous products in large quantities such as vitamins. Process costing is used to assign costs to each step of the production process and then allocate them to the final product. This makes it easier to determine the cost per unit of product. The other options such as a print shop, a headhunting firm, and a custom bike builder produce unique products and services which require job costing instead of process costing.

For Which Business Is Process Costing Is Most Appropriate