The Process Costing System is a method of assigning costs to products and services based on the various activities or operations required to produce them. In this system, all costs associated with each operation are totaled and then divided by the number of units produced. This ensures that each unit receives an equitable amount of cost for the activities related to its production. By allowing businesses to track their costs accurately and allocate the right amount of overhead costs to their products, the Process Costing System helps create accurate pricing decisions and maximize profitability.