ECONOMICS

Detailed explanation-1: -products are heterogeneous. Process costing is not applicable to heterogeneous products because they are unique products. Examples are yachts and hand-made products.

Detailed explanation-2: -Answer and Explanation: The correct answer is option D) A builder of customized yachts. A builder who customized yachts manufacturer is likely to use job-order costing as it engaged in manufacturing customized items.

Detailed explanation-3: -Process costing is generally used by manufacturers that produce a large volume of identical items, such as companies involved in oil refining, food production, chemical processing, textiles, glass, cement and paint.

Detailed explanation-4: -Examples of companies that use process costing include Chevron Corporation (petroleum products), the Wrigley Company (chewing gum), and Pittsburgh Paints (paint). A job costing system2 is used by companies that produce unique products or jobs.