Scribd Logo
Upload

Welcome to Scribd!

  • 7 views

    CostCon - Chapter 1

    Uploaded by

    wktxlsrkf

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    CostCon - Chapter 1

    Uploaded by

    wktxlsrkf
    7 views2 pages

    Original Title

    »CostCon - Chapter 1« (3)

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    7 views2 pages

    CostCon - Chapter 1

    Uploaded by

    wktxlsrkf

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 2

    COST ACCOUNTING AND CONTROL

    1. It emphasizes a weekly or monthly


    & JOB ORDER COSTING
    time period rather than the time
    taken to complete a specific order.
    2. It uses several Works in Process PROCESS COSTING JOB ORDER COSTING
    Inventory accounts - one for each
    department or work center in the 1. Homogenous 1. Unique jobs are
    manufacturing process. units pass through a worked on during a
    series of similar time period.
    Many manufacturing firms have processes.
    production systems which are not suited 2. Costs are 2. Costs are
    for strictly job-order costing or process accumulated by accumulated by
    costing but instead require a costing processing individual job.
    system which incorporates ideas from department.
    both. This blending of ideas is known as 3. Unit costs are 3. Unit costs are
    hybrid costing. computed by determined by
    dividing the dividing the total
    Job-order Product-costing Systems → individual costs on the job cost
    Hybrid Costing System → Process departments’ costs sheet by the number
    product-costing systems by the equivalent of units on the job.
    production.
    Operation Costing is a hybrid costing 4. The cost of 4. The job cost sheet
    system often used in repetitive production report provides the Details
    manufacturing where finished products provides the detail for the work in
    have common, as well as distinguishing for the Work in Process account.
    characteristics. Process account for
    each department.
    Some companies process large orders of
    identical units as a group through the
    same production sequence. Each of these In job costing, costs are accumulated for
    orders is called a batch. each job or batch produced. In process
    In batch production, costs are allocated to costing, costs are accumulated by the
    each batch. Whenever a change in the department for an accounting period (for
    production line is required to continue example, a month).
    production, a new batch is created.
    Generally, job costing concepts are used Process costing has less detailed
    to account for batch production and each recordkeeping, hence, if a company was
    batch is treated as a job for costing choosing between job and process
    purposes. costing, it would generally find that
    recordkeeping costs are lower under
    process costing.

    Process costing does not provide as much


    information as job costing because
    records of the cost of each unit produced
    are not kept using process costing. The
    choice of process versus job costing
    systems involves a comparison of the
    MAJOR DIFFERENCES BETWEEN PROCESS costs and benefits of each system.

    1
    COST ACCOUNTING AND CONTROL

    As a general rule job systems are usually


    more costly than process systems.

    If recordkeeping costs were equal under


    job and process systems, for the units in a
    product line, then the job costing systems
    are better because they provide all of the
    data that process systems do.

    You might also like