Distinguishing between job order costing and process costing Following is a list of cost system characteristics and sample companies. Match each to either job order costing or process costing. Companies that produce small quantities of many different products. A company that pulverizes wood into pulp to manufacture cardboard. A company that manufactures thousands of identical files. Companies that produce large numbers of identical products. A computer repair service that makes service calls to homes. A company that assembles electronic parts and software to manufacture millions of portable media players. A textbook publisher that produces copies of a particular book in batches. A company that bottles milk into one-gallon containers. A company that makes large quantities of one type of tankless hot water heaters. A governmental agency that takes bids for specific items it utilizes where each item requires a separate bid.
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Distinguishing between
Following is a list of cost system characteristics and sample companies. Match each to either job order costing or process costing.
- Companies that produce small quantities of many different products.
- A company that pulverizes wood into pulp to manufacture cardboard.
- A company that manufactures thousands of identical files.
- Companies that produce large numbers of identical products.
- A computer repair service that makes service calls to homes.
- A company that assembles electronic parts and software to manufacture millions of portable media players.
- A textbook publisher that produces copies of a particular book in batches.
- A company that bottles milk into one-gallon containers.
- A company that makes large quantities of one type of tankless hot water heaters.
- A governmental agency that takes bids for specific items it utilizes where each item requires a separate bid.
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