The existence of ending work in process inventory necessitates the use of the 5-step process costing procedure.

Question

Quizplus · Accepted Answer

The use of the 5-step process costing procedure is necessary when there is ending work in process inventory because it helps to allocate costs appropriately between completed units and those still in production. If there is no ending work in process inventory, the process costing procedure can be simplified to only allocating costs to the completed units.

The Existence of Ending Work in Process Inventory Necessitates the Use