Limitations of Job Order Costing
- Job costing involves comparison of profitable and non-profitable opportunities. This cost comparison can become worthless for many industries when there are major changes in the economic
- It is a very expensive option.
- Additional clerical work is required for collecting money from an individual
- The effectiveness of a job costing system highly relies on the operation of a steady production control system.
- Nature wise job costing system is based on the costing of the past. Due to this nature, it is meaningless to be used for controlling and planning for future purposes in
Links of Previous Main Topic:-
- Introduction to accounting and branches of accounting
- Preparation of final accounts
- Introduction of fund flow statement
- Introduction cash flow statement
- Ratio analysis significance of ratio analysis
- Fixed assets and depreciation meaning causes objectives methods and basic factor
- Cost accounting concept objectives advantages limitations general principles and cost sheet
- Job costing
Links of Next Finance Topics:-
- Batch costing
- Test questions in job costing
- Activity based costing introduction concept and classification
- Introduction inventory pricing and valuation
- Standard costing introduction
- Management accounting
- Marginal costing
- Relevant cost for decision making
- Budget and budgetary control
- Limitations of historical accounting
- Introduction to responsibility accounting
