Cost Accounting

AccountingAdvanced Level

10 flashcards

Card 1 of 1010%

Question

What is the purpose of job order costing in cost accounting?

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Answer

Definition

Job order costing tracks costs for individual jobs or orders, allowing companies to determine profitability on a per-job basis.

Example

A custom furniture maker uses job order costing to account for materials and labor for each unique piece, ensuring accurate pricing.

Quick Tip

Think 'custom jobs' for tailored costing.

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