COST ACCOUNTING
MANUFACTURING OVERHEAD
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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must be similar to previous jobs completed.
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has its own distinguishing characteristics.
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must be completed before a new job is accepted.
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consists of one unit of output.
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Detailed explanation-1: -An important feature of job order costing is that each job or batch has its own distinguishing characteristics. For example, each house is custom built, each consulting engagement by a CPA firm is unique, and each printing job is different.
Detailed explanation-2: -Importance of job order costing It helps the company make estimates about the value of materials, labor, and overhead that will be spent while doing that particular job. Efficient job order costing helps companies to create quotes that are low enough to be competitive but still profitable for the company.
Detailed explanation-3: -Differences − Job Costing and Batch Costing The term “job costing” describes a technique for doing so. Batch costing is a method of determining costs based on batches of identically produced items. In this system, the quantity produced in each batch is tracked together with its unit cost.