Question

Match each of the following items A through G with the best

numbered description of its purpose.

B. Process cost summary

1. Notifies the materials manager to send materials to a production

department.

2. Holds costs of indirect materials, indirect labor, and similar costs until

assigned to production.

3. Holds costs of direct materials, direct labor, and applied overhead until

products are transferred from production to finished goods (or another

department).

4. Standardizes partially completed units into equivalent completed units.

5. Holds costs of finished products until sold to customers.

6. Describes the activity and output of a production department for a period.

7. Holds costs of materials until they are used in production or as factory

overhead.

Short answer

Process cost summary - Describes the activity and output of a production

department for a period.

Step-by-step solution

Meaning of process cost summary

A production report called a process cost summary includes the expenses, output,

and costs associated with each production unit for a department. In other words, this

report summarizes all the production operations for a specific process or department.

Meaning of Process operation

Any method of creating or preparing, including any capacity or handling of

materials or objects before, during, or after manufacturing or processing, is implied

by the term "process operations."

Main purpose of process cost summary.

A production report called a process cost summary records the costs caused by a

department, the units produced, and the costs relegated to the production units. To

put it another way, usually a report that records all the production operations for a

particular process or department.