A process cost system be appropriate for a

A process cost system would be appropriate for a

A process cost system would be appropriate for a Oa. custom cabinet builder Ob. jet airplane builder c. natural gas refinery
Question 28 A cover message should begin by addressing the reader by name when possible begin formally with To Whom It May Co


PART 1 – Answer: C: Natural Gas refinery A process cost system is a method of cost accounting used when an identical set of products are manufactured in bulk. This process is not used for different products. Option A can’t be the answer because of customization done to the cabinet builders. Process cost accounting is not suitable for products that are not identical in properties. Option B is also not the right answer. Cost process to be used by a jet builder company would be job costing and not process costing as in job costing each overhead and component is given a monetary value which helps the manager to keep a check on the expenses. Option C is the right answer as in refining costs are combined for each phase and department in order to calculate the costs of the products in each step of the refining activity. Option D is incorrect because for the catering business also job costing is used as each customer order is different. Along with customers, the menu and person attending to the customer also vary and hence, process costing can not be used. PART 2 – Answer A: Addressing the reader by name when possible Option A: in a cover letter message, the beginning should always be directly addressed to the concerned person and hence, the name should be used. Option B: this is not the right answer as in a firm there are several departments and in order to save time and avoid confusion in the communication the writer should be mentioning the person’s name the letter is intended for. Option C is wrong because in a cover letter a direct reference should be made as the writer should be explicit in communicating through a letter. Option D is incorrect as in a professional world, being respectful is reflected by the way one greets another. So salutation should never be omitted in a cover letter.

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