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Process costing works well whenever

A. heterogeneous products pass through a series of processes and receive different doses of materials, labor, and overhead.
B. material cost is accumulated by process and conversion cost is accumulated by process.
C. homogeneous products pass through a series of processes and receive similar doses of conversion inputs and different doses of material inputs.
D. homogeneous products pass through a series of processes and receive similar amounts of materials, labor, and overhead.
E. None of these.

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Answer:

The correct answer is D.

Explanation:

Process costing is the process of quantifying the expenses of the company associated with the production of a specific product. It is important to determine process costs because goods businesses must determine how much it costs to manufacture a product so that they can set their sales price effectively so that a profit is being produced. Process costing systems assign certain expenses to products by calculating the total costs at each stage of the manufacturing process, adding the costs and then dividing these costs by the total number of units that have been manufactured. Process costing systems are applicable when homogeneous goods are produced from a series of related operations.

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