Chapter_04.pptx - 4-1 Similarities Between Job-Order and...

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4-1 Similarities Between Job-Order and Process Costing Both systems assign material, labor, and overhead costs to products and they provide a mechanism for computing unit product costs. Both systems use the same manufacturing accounts, including Manufacturing Overhead, Raw Materials, Work in Process, and Finished Goods. The flow of costs through the manufacturing accounts is basically the same in both systems.
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4-2 Differences Between Job-Order and Process Costing Process costing: 1. Is used when a single product is produced on a continuing basis or for a long period of time. Job-order costing is used when many different jobs having different production requirements are worked on each period. 2. Systems accumulate costs by department. Job-order costing systems accumulated costs by individual jobs. 3. Systems compute unit costs by department. Job-order costing systems compute unit costs by job on the job cost sheet.
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4-3 Process costing is used for products that are: a. Different and produced continuously. b. Similar and produced continuously. c. Individual units produced to customer specifications. d. Purchased from vendors. Quick Check 
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4-4 Process costing is used for products that are: a. Different and produced continuously. b. Similar and produced continuously. c.
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