Question

1

a.Explain what is job order costing.

b. List 3 companies that could use job order costing and identify a type of product that they produce that will follow job orders. Ex: CPA firm, a job order would be the auditing service of 1 client.

Answer 1

a. Job order costing is a system for assigning and accumulating manufacturing cost of an individual unit of a product.The job order costing system is used when the various items produced are sufficiently different from each other and each has significant cost.

b. 1) Medical Service Businesses including hospitals,small doctor's offices and medical billing companies- This companies can use job order costing to each patient or bill as an individual job

2) Film Companies-Job order costing can be used for each film produced.

3) Accounting Firms - Such firm can consider each client a job