MANAGEMENT ACCOUNTING - Solutions Manual CHAPTER 8 SYSTEMS DESIGN: JOB-ORDER COSTING AND PROCESS COSTING

I. Questions 1. Job-order costing is used in those manufacturing situations where there are many different products produced each period. Each product or job is different from all others and requires separate costing. Process costing is used in those manufacturing situations where a single, homogeneous product, such as cement, bricks, or gasoline, is produced for long periods at a time. 2. The job cost sheet is used in accumulating all costs assignable to a particular job. These costs would include direct materials cost traceable to the job, and manufacturing overhead cost allocable to the job. When a job is completed, the job cost sheet is used to compute the cost per completed unit. The job cost sheet is then used as a control document for: (1) determining how many units have been sold and determining the cost of these units; and (2) determining how many units are still in inventory at the end of a period and determining the cost of these uni