16-23 - 16-2316-37 (continued)The second major difference...

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Unformatted text preview: 16-2316-37 (continued)The second major difference is that the computation made for thissituation had a single purpose, to price the boats being sold. A joborder cost system for a manufacturing company, on the other hand, mustserve several purposes at the same time. Certainly job order systemsare used by many manufacturing companies to assist in pricing productsfor sale. However, they also provide information for other decisionsand assist managers in controlling manufacturing operations. Inaddition, a primary purpose for job order cost systems used bymanufacturing companies is to calculate the cost of goods manufacturedso that the cost of goods sold and the cost of ending inventories canbe determined for financial reporting purposes.In spite of the above differences, the pricing computations requiredfor this situation require two steps that are also vital in a job order...
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