Ch 3 Q2-3 - managers with feedback that they can use to...

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2. Contrast the primary focus of job order cost accounting and of process cost accounting. The primary focus of a job order costing system is when a job is considerably different from other jobs. This method is applied when costs are traceable to specific jobs. All work is broken down into separate jobs and each job is tracked separately. In cost accounting each job is identified separately and prime cost and overhead charged to it. Labor and materials are entered on a job ticket. Overhead is added to the amount the customer will be charged for labor and materials. Process costing is used when is a large quantity of identical or similar products is mass produced. This method traces and accumulates direct costs, and allocates indirect costs, through the manufacturing process. Process costing provides
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Unformatted text preview: managers with feedback that they can use to compare similar product costs from one month to the next, keeping costs in line with projected manufacturing budgets. 3. What are the similarities between a job order and a process cost system? The similarities between a job order and a process cost system include: 1. Both systems track three manufacturing cost elements; direct materials, direct labor, and manufacturing overhead. 2. In both costing systems, raw materials are debited to Raw Materials Inventory; factory labor is debited to Factory Labor; and manufacturing overhead costs are debited to Manufacturing Overhead 3. The flow of costs- these costs are then assigned to the same accounts in both costing systems—Work in Process, Finished Goods Inventory, and Cost of Goods Sold....
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This note was uploaded on 09/20/2008 for the course ACC 349 taught by Professor Christie during the Spring '08 term at University of Phoenix.

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