Asked by Ahmad Ahmadzai on May 28, 2024
Verified
A process cost accounting system records all actual factory overhead costs directly in the work in process account.
Process Cost Accounting System
A method of accounting used to track and allocate costs associated with the production process.
Factory Overhead
All indirect costs involved in manufacturing, excluding direct materials and direct labor; includes items like utilities and salaries for managers.
- Comprehend how indirect materials and factory overhead are accounted for in cost calculations.
Verified Answer
EC
Esmeralda ColonMay 29, 2024
Final Answer :
False
Explanation :
In a process cost accounting system, factory overhead costs are accumulated in a separate account called the manufacturing overhead account. The costs are then allocated to the work in process, finished goods, and cost of goods sold accounts based on a predetermined overhead rate.
Learning Objectives
- Comprehend how indirect materials and factory overhead are accounted for in cost calculations.
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