ACCTG 102 Lecture Notes - Lecture 6: Jiffy Lube, U.S. Steel
Document Summary
More useful information for determining profitability of jobs. More useful for estimating costs when preparing bids on future jobs. Uses of process cost system process cost systems are used to apply costs to similar products mass produced in continuous fashion. Used by ben & jerry"s, usx, general mills, coca cola bottling. The process continues until fg emerges and each unit is like any other. In job order costing, costs are assigned to specific job; construction of a specialized customized home. Service companies that provide specific, nonroutine services will benefit from using a job order cost system. Companies that perform routine, repetitive services (jiffy lube routine aspects of car care) will be better off with process cost system. Similarities of the 2 systems: - 1) both use same 3 manufacturing costs; elements dl + dm + Moh debit overhead: the costs are assigned to wip, fg and cgs. The method of assigning the costs differs significantly.
