Question

Find a journal article online about job costing systems. In the subject line of your post, include the title of the article that you read. Post a link to that article with your initial post, and provide a summary and a reaction to the article. The summary should be approximately 250 words, and the reaction should be approximately 150 words. The summary should describe the major points of the article, and the reaction should demonstrate your interpretation of the article and how you can apply that knowledge.

Answer 1

Answer :

Job costing involves the accumulation of the costs of materials,labor and overhead for a specific job.This approach is an excellent tool for specific costs to individual jobs and examining them to see if the cost can be reduced in later jobs.An alternate use is to see if any excess costs incurred can be billed to a customer.

It accumulates costs at a small unit level. EX:job costing is appropriate for deriving the cost of constructing a custom machine,designing a software program,constructing a building or manufacturing a small batch of products.Job costing involves following activities:

• Materials: It accumulates the cost components and then assigns these costs to a product or project once the components are used.
• Labor: Employees charge their time to specific jobs,which are then assigned to the jobs based on the labor cost of the employees.
• Overhead: It accumulates overhead costs in cost pools, and then allocates these costs to jobs.

Job costing results in discrete "buckets" of information about each job that the cost accountant can review to see if it really should be assigned to that job.If there are many jobs currently in progress,there is a strong chance that costs will be incorrectly assigned,but the very nature of the job costing makes it highly auditable.