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Advantages of Job Order Costing

  1. Various companies use job order costing for seeing and comparing which businesses are more profitable for utilisation and which jobs do not give any profit.
  2. A number of functional units and several factors related to operating efficiency can be decided by the management with its help.
  3. An organisation with the help of job order costing can plan and prepare a future production by using the information of similar job costing.
  4. Job order costing assists the management in taking productive steps by identifying and pinpointing any defects, depletion and spoilage in production orders and also helps them to reduce it to a minimum level.
  5. Every benefit of budgetary control can be gained by engaging in fixed expenditure rates in job costing.