Which of the following is true of job order cost systems?
A) Examples of companies that use job order cost systems would be oil refineries, paper producers, chemical processors, and food processors.
B) Job order cost systems are not widely used.
C) Job order cost systems are often used by companies that manufacture custom products for customers or batches of similar products.
D) Job order cost systems provide product costs for each manufacturing department or process.

Question

Quizplus · Accepted Answer

Job order cost systems are often used by companies that manufacture custom products for customers or batches of similar products. They are not used by all types of companies, but primarily by those that have a diverse set of products and production processes. Examples of companies that use job order cost systems include printers, machine shops, and furniture manufacturers. These companies need to know the cost of producing each individual product or batch in order to price their products appropriately and maximize their profitability.

Which of the Following Is True of Job Order Cost