Question

Where raw material is to pass certain stages, before it is converted into finished goods, the method of costing used is ____________.

• A. Job costing
• B. Operating costing
• C. Process costing
• D. Both B and C

Answer 1

Answer: (C)

Process costing

Some times a production unit passes through various process before it gets finished. In such situation it is important to know the cost of each process. For example, oil industry. In such cases, process costing is used.