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163 - 16-3TESTING YOUR KNOWLEDGE16-1 Job order costing is...

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Unformatted text preview: 16-3TESTING YOUR KNOWLEDGE16-1 Job order costing is best suited to a manufacturing environment thatproduces unique individual products or groups of products. When acompany manufactures one unit of a unique product, it treats that unitas a job order. When a company manufactures units of a unique group ofproducts, it also treats them as a job order. Therefore, a job order,or "job," can be a single product or service, or a unique group ofproducts being manufactured together. One characteristic of a joborder is that it is easy to determine when the job starts and ends. Acompany often starts jobs as a result of "sales orders" for particularitems from specific customers. The job ends when the order iscomplete. In job order manufacturing, production departments such asmachine shops, or assembly and finishing departments may performmanufacturing operations on hundreds of different jobs in a month's...
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