Final answer:
A process cost accounting system is characterized by restating opening and closing work-in-process inventory in terms of completed units to allocate costs properly.
Step-by-step explanation:
The characteristic of a process cost accounting system that stands out is the treatment of the opening and closing stock of work in process. Unlike a job costing system where the focus is on accumulating costs by orders and custom jobs, a process cost system typically deals with products that are homogenous. In such a system, opening and closing stocks of work in process are restated in terms of completed units to accurately allocate the costs among units produced.
Variable costs, such as labor and raw materials, increase or decrease with the output in both job costing and process costing. However, the distinction lies in how costs are accumulated and accounted for. In a process cost system, costs are accumulated over a period and then allocated across all units, whereas in a job costing system, they are tracked for each specific order. Moreover, fixed costs, like rent for a factory, remain constant regardless of the production level. Hence, the correct answer to the question is that in a process cost accounting system, Opening and Closing stock of work in process are restated in terms of completed units.