JOC COSTING

What is Job Order Costing?

• A method of costing where work is undertaken to customer's specific requirements on the basis of orders

• A method of costing where work is undertaken to customer's specific requirements on the basis of estimates

• A method of costing where work is undertaken to customer's general requirements

• A method of costing where work is undertaken without any specific requirements

How is unit cost computed in Job Order Costing?

• By dividing the total job cost by the total number of jobs

• By dividing the total job cost by the units produced on the job

• By dividing the total job cost by the total direct material cost

• By dividing the total job cost by the total direct labour cost

What is the purpose of Predetermined Overhead Rate (POR)?

• To calculate the total manufacturing overhead cost

• To calculate the total direct material cost

• To establish the relationship between estimated overhead cost and expected allocation base

• To calculate the total direct labour cost

What is the formula to calculate Predetermined Overhead Rate (POR)?

• Total direct material cost/Total direct labour cost

• Total job cost/Units produced on the job

• Estimated overhead cost/Expected allocation base

• Total manufacturing overhead cost/Total direct material cost

How is the output price determined in Job Order Costing?

• By applying manufacturing overhead to the job

• By calculating the Predetermined Overhead Rate (POR)

• By dividing the total job cost by the units produced on the job

• By calculating the total direct material cost

What is the characteristic of products produced in Job Order Costing?

• Produced based on company's internal needs

• Produced without any specific requirements

• Produced in large quantities

• Produced based on customer order and specification

How is manufacturing overhead cost assigned in Job Order Costing?

• By calculating Predetermined Overhead Rate (POR) and applying it to the job

• By dividing the total job cost by the units produced on the job

• By calculating the total direct material cost

• By calculating the total direct labour cost

What is the overview of the chapter regarding Job Order Costing vs Process Costing?

• Both Job Order Costing and Process Costing are used for homogeneous products

• Both Job Order Costing and Process Costing are used for distinct products

• Job Order Costing is used for homogeneous products while Process Costing is used for distinct products

• Job Order Costing is used for distinct products while Process Costing is used for homogeneous products

What is the purpose of assigning Direct Labour Cost in Job Order Costing?

• To track the labour hours spent on the job

• To calculate the Predetermined Overhead Rate (POR)

• To calculate the total direct material cost

• To calculate the total manufacturing overhead cost

What is the purpose of applying manufacturing overhead to the job in Job Order Costing?

• To calculate the total direct material cost

• To calculate the total direct labour cost

• To calculate the Predetermined Overhead Rate (POR)

• To allocate the overhead costs to the job