ECONOMICS

COST ACCOUNTING

JOB ORDER COSTING

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Which company would most likely use job order costing?
A
Service Company
B
Beverage Company
C
Oil Company
D
Cereal Company
Explanation: 

Detailed explanation-1: -Companies in the white-collar sector of business, including law firms, accounting businesses, and private investment companies, can utilize job order costing to manage individual client accounts. For example, accounting firms can consider each individual client a job.

Detailed explanation-2: -Answer: Paint manufacturer, Yacht builder and soft drink bottler companies are most likely to use the process costing system. The print shop and caterer are most likely to use the job order costing system.

Detailed explanation-3: -Job order costing is also used for service businesses where the service and costs are unique to each customer, such as those of an attorney, accountant, physician, or event planner. Each customer, client, or patient is a separate job or project.

There is 1 question to complete.