Final answer:
Statement C, which is that process costing is suitable for production processes where similar units are produced in a continuous flow, is the correct statement. Changes in labor costs affect the selection of production technology, with companies shifting from labor-intensive to more machinery-intensive methods as the cost of labor increases.
Step-by-step explanation:
The correct statement about process costing is C. Process costing is appropriate for those production processes where similar units are produced in a continuous flow. This system is used in industries where the production is mass and indistinguishable, such as in manufacturing of chemicals or food. Under process costing, multiple processes or departments work in a connected sequence, and each process has its distinct work in process (WIP) account that records the costs for that particular process. As labor costs rise, firms may adapt by changing their production technologies to favor those with less reliance on labor and more on machinery if it's cost-effective.
Regarding the information on production technology's reaction to labor cost changes, the total cost will vary based on the cost of labor and machinery used. This relates to cost accounting principles within process costing, where companies analyze technology and cost requirements to make decisions on the production methods that align with their cost structures.