Process Costing System:
After studying this chapter you should be able to:
- Define and explain process costing.
- Explain the uses of process costing system.
- Explain the advantages and disadvantages of Process Costing System?
- Definition and explanation of process costing system:
Cost accumulation procedures used by manufacturing concerns are classified as either job order costing or process costing. The Job Order Costing System chapter deals with the procedures applicable to job order costing. click here to read full article.
- Characteristics and Procedures of Process Costing System
- Costing By Departments:
The nature of manufacturing operations in firms using process or job order cost procedures is usually such that work on product takes place in several departments. Click here to full article
- Product Flow:
A product can flow through a factory in numerous ways. Three product flow formats associated with process costing – sequential, parallel, and selective – are illustrated here to indicate that basically the same costing procedures can be applied to all types of product flow situations. Click here to read full article.
- Procedure for Materials, Labor and Factory Overhead Costs in a Process Costing System:
In process costing, materials, labor, and factory overhead costs are accumulated in the usual accounts, using normal cost accounting procedures. Costs are then analyzed by departments or processes and charged to departments by appropriate journal entries. Click here to read full article.
- Cost of Production Report (CPR):
A departmental cost of production report (CPR) shows all costs chargeable to a department. It is not only the source for summary journal entries at the end of the month but also a most convenient vehicle for presenting and disposing of costs accumulated during the month. Click here to read full article
- General Questions and Answers About Process Costing
Find answers of various questions about process costing system. Click here to read.
- Exercises and Problems:
Solved problems about process costing system Click here.
- Process Costing System – Case Study