Job-Order Costing vs. Process Costing
Both systems have the same basid purpose
to assign material, labor, and manufacturing overhead costs to products and to provide a mechanism for computing unit product costs.
Both systems use the same basic manufacturing accounts
Manufacturing Overhead, Raw Materials, Work in Process, and Finished Goods.
Job-order costing is used when a company produces many different jobs that have unique production requirements
Process costing is used when a company produces a continuous flow of units that are indistinguishable from one another.
Job-order costs are accumulated by individual job
Process costs are accumulated by department
Unit cost are computed by job on the job cost sheet
Unit costs are computed by deparment
The flow of costs through the manufacturing accounts
basically the same in both systems.