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An Example of Job Order Costing

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The primary objective in job order costing is to determine the cost of materials, labor, and factory overhead used to produce a specific order or contract. Cost estimates are made when the order is taken, and the job order procedures are designed to reveal costs as the order goes through production, thereby giving an opportunity to control costs.

Search the internet and provide an example of a company that is using or could use Job Order Costing. What are the benefits to the organization to use Job Order costing? Are there are disadvantages? Explain.

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Solution Summary

Much of the construction industry uses job order costing to commit to contracts and make bids on infrastructure design. Aberdeen Construction is a company that uses contracts

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Much of the construction industry uses job order costing to commit to contracts and make bids on infrastructure design. Aberdeen Construction is a company that uses contracts to build schools, churches, company headquarters, housing projects, and steel buildings (Aberdeen Construction, 2010). This company uses estimates to bid on developing and building the infrastructure of these projects. The company will use job order costing to develop a bid ...

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