Final answer:
Organizations that produce homogeneous products in large quantities and experience economies of scale are more likely to use a process costing system. This method efficiently tracks and assigns costs in environments with uniform processes and identical outputs. It's suitable for industries like manufacturing where mass production at a lower average cost is achievable.
Step-by-step explanation:
The major characteristic of an organization that would likely use a process costing system for accumulating product costs, instead of a job-order costing system, is its production of homogeneous products or services on a large scale. Organizations that benefit from economies of scale and operate in industries such as manufacturing, chemicals, or food processing, where products are indistinguishable from each other and produced continuously, are ideal for process costing. This costing method is efficient for tracking and assigning costs when the processes involved are uniform and the output is identical.
Organizations operating on a large scale often experience economies of scale, meaning that as the quantity of output increases, the cost per unit decreases. This advantage is typically seen in firms that utilize technologies such as assembly lines and large department stores, enabling mass production at a lower average cost compared to smaller scale operations. Therefore, a company producing a significant volume of homogeneous products would choose process costing to reflect the continuous flow of units and the consistent application of costs.