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What is job costing?
Job costing is the part of study in accounting that acknowledges about keeping record of the costs of manufactured products or manufacturing jobs. An accountant needs to record costs of unit job and this job can be software. Now the purpose is getting profit through that job. For recording job costing in a company, job must be numbered. Different job items are indicated through different numbers. Many times the term gets confused with process costing.
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Job costing is different than process costing
A student must understand that how job costing and process costing are different than each other.
- Job costing records take place for distinct products and these are different by means of If you go through process costing, then it is related to the costs of accumulation of processes.
- Next difference is just about their quantity. You can say that the quantity of items in job coting can be very small unit, but in case of process costing it is just available in a large manner.
In brief job costing goes through material and labour cost of a product. However, processes are common and requirement goes through the whole which is always a large quantity.
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What is the need of cost codes?
Cost codes are required for preparing budget. This code acknowledges the budget of a job and its actual expenditure or cost. Job costing process requires different job drivers to evaluate job costs.
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