A comparison of the basic principles of process costing with those of job costing, given below, will assist in appreciating process costing procedures.

Advertisement

 

Job Costing Process Costing
1. Production is by specify orders 1. Production is in continuous flow, the products being homogeneous.
   
2. Costs are determined by jobs or batches of products 2. Cost are compiled on time basis, i.e. for production for a given accounting period, for each process or departments.
   
3. The various jobs are separate and independent of each other. 3. Being manufactured in a continuous flow, products lose their individual entity.
   
4. Unit cost of a job is calculated by dividing the total cost incurred into the units produced in the lot or batch. 4.  The unit cost of a process, which is computed by dividing the total cost for the period (after adjustment of the opening and closing work-in-process), is an average cost for the period.
Advertisement
The following two tabs change content below.
We, at BMS.co.in, believe in sharing knowledge and giving quality information to our BMS students. We are here to provide and update you with every details required by you BMSites! If you want to join us, please mail to [email protected]
13 Comments

Leave a reply

BMS.co.in is aimed at revolutionising Bachelors in Management Studies education, also known as BMS for students appearing for BMS exams across all states of India. We provide free study material, 100s of tutorials with worked examples, past papers, tips, tricks for BMS exams, we are creating a digital learning library.

Disclaimer: We are not affiliated with any university or government body in anyway.

©2020 BMS - Bachelor of Management Studies Community 

A Management Paradise Venture

Ask Us On WhatsApp
or

Log in with your credentials

or    

Forgot your details?

or

Create Account