Cost accounting systems are used ________.
A) to accumulate product cost information
B) to accumulate and assign period costs to products
C) by manufacturing companies, not service companies
D) by stockholders for decision-making purposes

Question

Quizplus · Accepted Answer

Cost accounting systems are primarily used to accumulate product cost information, which helps in determining the cost of producing each product. This system is crucial for setting prices, controlling operations, and making inventory valuation decisions. Choices B, C, and D are incorrect because cost accounting systems do not typically assign period costs directly to products (these are usually treated as expenses in the period they are incurred), they are used by both manufacturing and service companies, and they are more directly used by management for internal decision-making rather than by stockholders.

Cost Accounting Systems Are Used ________