Q 15E_f - Horngren'S Financial And Managerial Accounting

Question

Following is a list of cost system characteristics and sample companies. Match each to either job order costing or process costing.

f. A company that assembles electronic parts and software to manufacture millions of portable media players.

Step-by-Step Solution

Answer

Answer:

Process costing system is used by the company that assembles the parts and softwares to produce million of portable media players.

Step-by-Step Solution:

Step 1: Process costing system

The companies which are engaged in manufacturing the similar product in large quantity which passes through series of procedures use the process costing system for determining the cost of production.

Step 2: Classification of costing system according to the characteristics

The companies that assembles the electronic parts and softwares to manufacture million of portable media players use the process costing system because assembling of parts is a process of manufacturing the portable media players and it is manufactured in large quantity.