Question

Question: Are there situations where Google can use process costing? Identify at least one and explain it.

Short answer

The cost incurred by Google foreach search made by the customer.

Step-by-step solution

Definition of Process Costing

The costing method used by the business entity to allocate operational costs to the goods produced in mass is known as process costing. It is used by the business entity whose product passes through different processes.

Use of process costing by the service company

Even if the service-providing company does not have inventory, they can also use process costing. The company can use it to provide a homogenous type of service to each customer.

Situation where Google can use process costing

Google can use process costing because it provides a similar service to several customers. Google can use process costing by determining the cost incurred by them for each of the searches made by the individual. All the content over google belongs to third parties who upload it to generate revenue; therefore, google has to pay an amount to the owner of the content. Here, google can identify the cost incurred each time customers access any site or link.