ECONOMICS

Detailed explanation-1: -With process costing, companies determine item cost by tracking the cost of each stage in the production process, instead of tracking costs for each individual item. After adding up the cost of all the steps in the process, they divide the total cost by the number of items. This is called the cost per unit.

Detailed explanation-2: -Answer and Explanation: The given statement is false. Process cost system tracks cost of each production process and not costs of individual jobs. This is because the production process is standardized and not different for every other product.

Detailed explanation-3: -Process cost systems are used to apply costs to a specific job, such as the manufacturing of a specialized machine. In a process cost system, costs are tracked through a series of connected manufacturing processes or departments, rather than by individual jobs.

Detailed explanation-4: -In a process costing system, costs are traced directly to jobs. When materials are purchased in a process costing system, a work in process account is debited with the cost of the materials. In a process costing system, overhead is allocated to departments after being applied to units of product.