Asked by Jessie Ernst on May 27, 2024
Verified
Job-order costing would be more likely to be used than process costing in situations where many different products or services are produced each period to customer specifications.
Job-order Costing
An accounting method used to track the expenses of specific jobs and calculate the cost of production for each job.
Process Costing
Process costing is an accounting methodology used for homogeneous goods, which systematically allocates the costs of production for each unit by averaging the total costs over all units produced.
- Acquire knowledge of the differences between process costing and job-order costing systems, and ascertain the circumstances where each system is most suitable.
Verified Answer
SA
Shaikh AbdulaleemMay 28, 2024
Final Answer :
True
Explanation :
Job-order costing is used when specific products or services are produced to customer specifications, whereas process costing is used when large quantities of identical products are produced through a continuous process. Therefore, when there are many different products or services produced each period to customer specifications, job-order costing would be more appropriate.
Learning Objectives
- Acquire knowledge of the differences between process costing and job-order costing systems, and ascertain the circumstances where each system is most suitable.