PPT: Job Costing | Cost and Management Accounting for CA Intermediate PDF Download

 Page 1


JOB COSTING &
PROCESS COSTING
Page 2


JOB COSTING &
PROCESS COSTING
JOB COSTING
Job costing is that form of specific order costing 
which applies where work is under taken to 
customer’s  special requirements and each order  
is  comparatively  short duration . The work is 
usually carried out within a factory or workshop and 
moved through processes and operations as  
constantly  identifiable units.
Ex: Engineering jobs, construction jobs, printing 
jobs, furniture making, fabrication jobs etc. 
Page 3


JOB COSTING &
PROCESS COSTING
JOB COSTING
Job costing is that form of specific order costing 
which applies where work is under taken to 
customer’s  special requirements and each order  
is  comparatively  short duration . The work is 
usually carried out within a factory or workshop and 
moved through processes and operations as  
constantly  identifiable units.
Ex: Engineering jobs, construction jobs, printing 
jobs, furniture making, fabrication jobs etc. 
FEATURES
? It is a specific order costing.
? The job is carried out or the product is produced to meet the 
specific requirement of the order.
? It is concerned with the cost of an individual job or batch 
regardless of the time taken to produce it , but normally 
short duration of time.
? Cost are collected to each job at the end of it’s completion.
? The cost of job is ascertained by adding material, labour
and overheads
? Work in progress may or may not exist at the end of the 
accounting years. 
Page 4


JOB COSTING &
PROCESS COSTING
JOB COSTING
Job costing is that form of specific order costing 
which applies where work is under taken to 
customer’s  special requirements and each order  
is  comparatively  short duration . The work is 
usually carried out within a factory or workshop and 
moved through processes and operations as  
constantly  identifiable units.
Ex: Engineering jobs, construction jobs, printing 
jobs, furniture making, fabrication jobs etc. 
FEATURES
? It is a specific order costing.
? The job is carried out or the product is produced to meet the 
specific requirement of the order.
? It is concerned with the cost of an individual job or batch 
regardless of the time taken to produce it , but normally 
short duration of time.
? Cost are collected to each job at the end of it’s completion.
? The cost of job is ascertained by adding material, labour
and overheads
? Work in progress may or may not exist at the end of the 
accounting years. 
PROCEDURES
Direct
Labours
Direct
Materials
Direct
Expenses
Factory
Overhead
Work-in -Progress
Add: Administrative, Selling And 
distribution OH
Cost of 
Sales
Add: Profit
Selling Price
Page 5


JOB COSTING &
PROCESS COSTING
JOB COSTING
Job costing is that form of specific order costing 
which applies where work is under taken to 
customer’s  special requirements and each order  
is  comparatively  short duration . The work is 
usually carried out within a factory or workshop and 
moved through processes and operations as  
constantly  identifiable units.
Ex: Engineering jobs, construction jobs, printing 
jobs, furniture making, fabrication jobs etc. 
FEATURES
? It is a specific order costing.
? The job is carried out or the product is produced to meet the 
specific requirement of the order.
? It is concerned with the cost of an individual job or batch 
regardless of the time taken to produce it , but normally 
short duration of time.
? Cost are collected to each job at the end of it’s completion.
? The cost of job is ascertained by adding material, labour
and overheads
? Work in progress may or may not exist at the end of the 
accounting years. 
PROCEDURES
Direct
Labours
Direct
Materials
Direct
Expenses
Factory
Overhead
Work-in -Progress
Add: Administrative, Selling And 
distribution OH
Cost of 
Sales
Add: Profit
Selling Price
ADVANTAGES
? The profit or loss made on each job can be 
measured.
? It generates the cost data which is useful for the 
analysis and control by management.
? It highlights whether the job is profitable or not.
? Job costing enable a comparison to be made with 
performance on other job so that inefficiencies are 
identified and rectified.