Compare And Contrast Job Costing And Process Costing

1. Briefly compare and contrast job costing with process costing. Provide an example of process costing. 2. Define a product cost flow. Give a real-life example of a product cost flow. 3. What is contained in a product cost report? Describe how to generate a production cost report.

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JOB COSTING AND PROCESS COSTING

According to Heisinger and Hoyle (2012), job costing is used to record all the incomes and expenses relating to that special product, the unit cost information is derived from the job cost sheet and it involves only one work-in-process inventory account. It is also used for small production jobs, entails detailed record keeping due to the fact that time and materials used for a particular job must be charged directly to the job and the record kept might be used as billing to customers. On the other hand, process costing system is the approach used to

In June, raw materials used were machining $18,000 and assembly $4,000. Factory labor costs were machining $12,000 and assembly $5,000. Manufacturing overhead costs were machining $6,000 and assembly $2,500. The company transfers finished units at a cost of $19,000 in the machining department to the assembly department. The assembly department transfers units completed at a cost of $11,000 to finished goods and a product with the cost of $3,000 are sold to customers. The journal entry of these costs to the two processes and the transfer of the units are as