Job Order Costing Essay Example | Topics and Well Written Essays - 1250 words

Job roll cost - Essay ExampleJob sound out costing is applicable to job order march in factories, workshops, and repair shops, as well as to work by builder, construction, engineers, and printers. It is a highly recyclable procedure, and allows for these various different occupations to do their work efficiently and at the costs that were predetermined to go make in hand with each job.In job order costing, the key is that the work is done to the customers specifications. As a result, each job tends to be different in nature. Even if the job may wait to be on the dot the same at first, often a customer will want a worker to do something different than what was originally thought to be done. For example, job order costing is utilize for construction projects, government contracts, shipbuilding, railcarmobile repair, job printing, textbooks, toys, wood furniture, office machines, caskets, machine tools, and luggage. Accumulating the cost of professional serve (e.g., lawyers, doctors and CPAs), also fall into this category (MAAW, What Is a Cost Accounting System?). Job Order Costing is used by companies where products or go are identifiable by exclusive units or batchesauto repair, tax return preparation, case in an attorneys office, ship construction, etc. The costs imputable to a particular job are assigned directly to it. Difference between Job order Costing and branch CostingIn Job Order Costing,Unit Cost computed by job. many another(prenominal) jobs are worked during the full stop.Costs are accumulated by individual jobs.Costs are traced and applied to individual jobs in Job order cost system.In Process Costing,Costs are accumulated by departments.Unit costs are computed by department.A single product is produced for a long period of timeCosts are traced and applied to departments in a Process Cost system.(McGraw-Hill/Irwin, Chapter4, Systems Design Process Costing) Primary Objective in Job order Costing When a job produces a specific quantity for inventorying, job order costing permits the computation of a unit cost for inventory costing purposes. When jobs are performed on the basis of customer specifications, job order costing permits the computation of a profit or loss on each order. Since costs are revealed as an order goes by dint of production, these costs may be compared with estimates which were made when an order was taken. Job order costing thereby provides opportunities for peremptory costs. It allows the person to help try to keep costs as stable as they can, yet stable find a way to make a profit. This ability helps keep both the worker and customer happy, and helps promote a better relationship between the contractor or professional and the person who is give for the work. This can also help keep costs low, because the customer does not need to pay for services they do not need, even if the professional is capable of doing them. This way, the customer only needs to pay for exactly what they need from the professional. When job order or process cost methods are used, costs must be accumulated for control purposes according to the unit in which the product cost is to be stated. For example, Coal is metrical by the ton, chemicals by the gallon, and lumber by board feet. Products, such as machines, automobiles and shoes are metrical either by the individual unit or by a multiple