Job order manufacturing and process manufacturing
Read the article, Information Usefulness and Usage in Business Decision-Making: An Activity-Based Costing (ABC) Perspective .In a 4 to 6-page written report, address the following questions in APA forma
1. Job order manufacturing and process manufacturing are two major costing systems used in manufacturing. Answer the following questions regarding these two systems:
a. Compare and contrast the two costing systems.
b. Which costing system should a service firm, such as an advertising agency use?
c. How do these two systems provide decision-making information?
2. Describe activity based costing.
Give two examples where activity based costing is preferable over traditional costing.
a. How is activity-based costing useful for decision making?
b. Discuss the three overhead rate methods used in activity-based costing and consider their relative usefulness.
Ensure to use intext citation and give 6 peer review references preferably scholarly journals.
Solution Preview
Job Order Manufacturing and Process Manufacturing
Part One
Job order manufacturing and process manufacturing are important production processes that are applied in the manufacturing industry. Job order manufacturing is a system of assigning manufacturing costs to individual products that are produced (Pollard, 2018). On many occasions, costs are attached to each job order that goes through the manufacturing process. For example, where a piece of furniture is to be produced, the costs would be assigned through job order manufacturing since it involves the single order. For process manufacturing, costs are accumulated for a long time and products are usually not easy to distinguish from each other. It is mainly used where the product that is being produced is big enough and thereby can allow costs to be accumulated for various processes that are employed towards production of the product or service.
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