Quiz 5-week 5.docx - Parallel processing is another...

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Parallel processing is another processing pattern that requires two or more sequential processes to produce a finished good. Partially completed units (e.g., two subcomponents) can be worked on simultaneously in different processes and then brought together in a final process for completion Sequential processing requires that units pass through one process before they can be worked on in the next process in the sequence Since units are homogeneous and subjected to the same operations for a given process, each unit produced in a period should receive the same unit cost. The manufacturing cost flows for a process-costing system are generally the same as those for a job- order system. Similarly, raw materials, direct labor, and applied overhead costs flow into a work-in-process (WIP) account. When goods are completed, the cost of the completed goods is transferred from WIP to the finished goods account. Finally, as goods are sold, the cost of the finished goods is transferred to the cost of goods sold account.
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