Identify which of the following statements regarding job-order costing is true.
A)Job-order costing deals with great masses of like units.
B)Job-order costing is an averaging process.
C)In job-order costing, the measure of production is small, whereas in process costing the measure of production is large.
D)Job-order costing is not one of the two common systems of product costing.

Question

Quizplus · Accepted Answer

Job-order costing is used when each product or service produced is unique, with varying levels of complexity and resources required. Therefore, the measure of production is small, as each job is different. In contrast, process costing deals with large volumes of identical units, such as the production of bricks, where the measure of production is large. Option A is incorrect, as job-order costing deals with unique units, not great masses of like units. Option B is incorrect, as job-order costing assigns actual costs to each job, while averaging is used in process costing. Option D is incorrect, as job-order costing is one of the two common systems of product costing, along with process costing.

Identify Which of the Following Statements Regarding Job-Order Costing Is