Which of the following would be most likely to use process costing? A) Law firm B) Custom furniture manufacturer C) Lawn fertilizer manufacturer D) Auto body repair shop
Understand the Problem
The question is asking us to determine which business among the options provided is most likely to use process costing as an accounting method, which is commonly used in industries where production is continuous and the products are indistinguishable from one another.
Answer
A lawn fertilizer manufacturer.
The final answer is a lawn fertilizer manufacturer.
Answer for screen readers
The final answer is a lawn fertilizer manufacturer.
More Information
Process costing is typically used by companies that produce goods on a large scale in a continuous or repetitive process. Lawn fertilizer manufacturing fits this model due to the standardized nature of their production process.
Tips
A common mistake is confusing process costing with job costing, which is more suitable for custom or unique production activities.
Sources
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